Hollywood Hunter

After Valentine's Day in 1995, the financial or public news that quickly spread was undoubtedly the large-scale employee stock ownership plan of the new Internet technology company Igrid.

A total of 25 billion US dollars of huge rewards programs are involved. Even though many media have already predicted the analysis in advance, they are still shocked.Such a huge value of shares has directly followed Bill Gates' personal net worth of second place in the Forbes list last year. Once all of them are fulfilled, it will directly create hundreds of millions or millions. Regal.

Is Simon Westero crazy?

Okay, Simon Westero, once, really crazy, but this time, absolutely, no one would think that this young and super-rich man made the decision because he was crazy.

As more and more internal information flows out, the outside world also confirms this more and more.

Because this $25 billion worth of stock is definitely not unconditionally freely distributed to just over 25,000 employees worldwide in just a few years, but is accompanied by various restrictive terms.

The most watched Big Four of Igret, Tim Berners Lee, Jeff Bezos, Carol Butts and Alice Ferguson, are said to want to get the stock promised in their contract Share, you must first sign a new employment contract, and, because the original contract has not expired, the three of the total 17% of the stock award share, and a part will be placed in their next five years in the cash , And still have performance growth requirements.

Although the remaining stock for other management and ordinary employees is only 8%, it is also worth 8 billion US dollars.Even if it is impossible to average, the total share of all 25,000 employees will reach US$320,000.At this stage in Silicon Valley, where the demand for talent is very hungry, the average annual salary has rapidly increased to 80,000 US dollars, and the average bonus of 320,000 US dollars is also equivalent to the salary of many programmers for 4 years.

Moreover, everyone knows that many of them must take a larger share, even if they take 1.25% of the 8% share, according to the book value, they can reach the standard of billionaires.

Therefore, this batch of stocks is also not as easy to get started by outsiders, most of which are not free rewards, but low-priced subscriptions.The prerequisite for most employees participating in the reward and subscription program is to sign a competition agreement for at least three years.

As the wave of new technology becomes more and more turbulent, other capitals who want to enter the Internet industry often aim at the Igreat company, which has formed a number of sustainable business models, from this company, whether it is a portal , Search engines, social networking sites or online communities, etc., if you want to copy these business models, you can achieve half the result with half the effort.

It can be said that in recent years, the most troublesome problem for several senior executives of Igret is the continuous loss of core internal employees.

This total employee shareholding plan of 25 billion US dollars is equivalent to closing this door for many other competitors in at least a teenager in the future. For the rapidly changing Internet industry, at least three years of competition agreement restrictions, and The more management management competition agreements, the longer the limitation period is. Once you leave, you can no longer engage in related occupations within the specified period. Then, after the deadline of the competition agreement, whether the other party masters the technology or experience will basically be Will be outdated.

Obviously, with the huge valuation of Igret’s hundreds of billions of dollars, Simon Westero, outside the contract of the Big Four, can only keep this company for at least three years just by taking out 8 billion of stocks The advantages in all aspects are relatively cost-effective.

You should know that in February, Cisco's market value has easily exceeded 150 billion US dollars and went straight to 200 billion.

The development momentum and monopoly pattern is no less than that of Cisco's Igret. The listed valuation has reached 100 billion. After the listing, it may also be a super giant with a level of 200 billion US dollars.

There is no shortage of doubts in the disturbing discussions.

For most ordinary people, the biggest doubt is whether Igrid is really worth $100 billion?

The media is always the group of people who are the best at finding and answering public doubts.

News soon came out.

The East Coast paper media giant "The New York Times" published an article saying that according to internal sources, the company's revenue in 1994 will reach a terrible tens of billions of dollars.

Compared with the time limit for the establishment of Eaglet, five years to create tens of billions of dollars in revenue, as long as the public with some concepts on this should understand how terrible this data is.At this stage, many of the world's top 500 companies have not yet reached the revenue level of 10 billion US dollars.

Take Microsoft, which has relatively overlapping business areas.

In the last fiscal year, Microsoft, which had been established for 20 years, had annual revenues of only US$5.63 billion, and its annual net profit was US$1.29 billion.

In this data, the revenue is only equivalent to that of Igrid’s revenue of 5.41 billion US dollars last year, and Microsoft’s revenue growth in the past fiscal year is only 31%. Compared with the revenue of 10 billion US dollars this year, The annual growth rate equivalent to Igret still reaches about 100% of the horror level.

According to last year's public data, Igrid's loss in 1993 was US$390 million, but this was only because the company needed huge investment in R&D and marketing at the initial stage of development.

It is not difficult to find out if Igrid’s business is carefully examined. In addition to the e-commerce that has been burning money, the other core software business, data center business, advertising business, etc. have very high gross profit margins. Combined, at least they can achieve Comparable with Microsoft.According to Microsoft's 23% net profit margin in the previous fiscal year, Igreat's tens of billions of dollars in revenue can theoretically easily achieve a net profit of more than 2 billion US dollars.

The reason why this is not the case for the time being is mainly because Igerit is more interested in the future growth and therefore invests in all aspects of employees at all costs.

Even so, according to the analysis of the "New York Times" article, Igreat's rate of making money has clearly exceeded the rate of spending money. Compared with 1993, just past 1994, it is likely that there will be good profits.

When the "New York Times" article was published, five years to achieve tens of billions of dollars in revenue, even some professional financial media had to question this.

However, this seems to be the case.

The key is monopoly.

It is undoubted that Eaglenet, in conjunction with Cisco and AOL, has pushed the United States into the information age in the past five years.

Because of its early advantages, Cisco plans to monopolize the professional router and switch market, and AOL's market share in the ISP field far surpasses even the old giants such as AT&T. .

First of all, Igrid has almost all the basic Internet tools and software, and because of the perfect patent barriers built in advance, it is still only an exclusive business and no branches at this stage.

The wave of new technology is so turbulent, as long as you want to enter this field, as long as you want to create a website, you can not do without a series of Internet basic tool software.Obviously, this is exactly the most ideal'toll bridge' in Buffett's vision, and it is the only toll bridge for the global market.

Moreover, as Igerett adopts a "lease-paying" subscription model for charging in the software business, piracy damage is largely avoided.

Even if it is a website hiding in the horns of Africa, are you using pirated software? Just check the subscription information, without subscribing to the software, first of all, your website cannot appear in the recommendation system such as the Igrid portal. , Secondly, it may also face the lawsuit that Igrid comes from any time.

Therefore, any company that wants to make a difference in the Internet field must pay Igreat's "toll bridge".

Over the past few years, hundreds of thousands of new companies have sprung up across the Internet industry worldwide, but these companies have unwittingly contributed billions of dollars in revenue to Igret’s software business. .

A little simple calculation, there is no moisture in this area.

In addition, there is advertising business.

With a very mature business model in memory, it does not need to be too frustrating. In a few years, the advertising business of Eaglet has been very well divided into portal advertising, social network advertising, search engine advertising and advertising affiliate programs. Four parts.

Because of the absolute industry advantages brought by IE browser to Igret, companies outside the Westeros system who want to get more traffic can only serve ads to Igrit.

This is actually equivalent to another'toll bridge'.

Moreover, advertisers are no longer limited to Internet companies. The rise of new technology waves in traditional industries has also begun to test the field.

In the 1993 financial report released by Igrid last year, the advertising revenue has reached 1.15 billion US dollars. With the madness of the entire industry in 1994, the growth of this business is obviously only more crazy.

There are already some keenly aware media that only the software and advertising business, the combined revenue in 1994, may exceed the annual revenue of Igreut in 1993.

This is actually true for those who know the inside story.

In addition to the two cores of software and advertising, Igreat also has YWS data center business, e-commerce business, application store business, online games and even professional solutions and technology licensing, etc. These are generally equipped with other industries in the industry Industry advantages that competitors are far behind.

Other than that, it is just one of the online games. Last year's popular "Happy Farm", as of the end of 1994, 7 months after its launch, it brought huge revenue of $250 million to the operator of Igret. The development cost of this game is only 1.5 million US dollars, and the rate of return has reached more than 100 times.

There is also the data center business.

With the constant digging of the industry competitors in the past few years, Igrid's cloud computing technology solutions have gradually leaked. However, other competitors are unlikely to have various advantages related to Igrid in the short term.

In the past year, Igreat has successively invested in the construction of up to 11 large-scale data centers with investment of over 100 million US dollars in North America, Europe and Asia. Investment.It is conceivable that if there are not enough interests to drive, Igret will not do so at all.

Because the threshold of the data center business is relatively low, not to mention Igrid's core cloud computing technology, this field is not exclusive to Igrid. In the past few years, IBM, HP and even Microsoft and other veteran giants have entered this field. There are also many small and medium-sized independent data center enterprises opening up. Therefore, according to some statistics in the industry, YG's YWS business has a market share of only about 50%.

But this is only 50%. Relative to the industry's overall market size of nearly 5 billion U.S. dollars in the past year, it is probably also possible to imagine Igret's revenue volume in this business.

The final e-commerce.

With Amazon's seven large logistics distribution centers in the United States in succession, compared with their counterparts who have entered the market, Igreut's e-commerce business is clearly in a state of absolute success.Much of the information about e-commerce in Simon's memory also greatly avoids unnecessary groping attempts by Amazon.

Although e-commerce has brought Igret the biggest loss, but looking at the rapid growth in recent years, no one will doubt the huge commercial potential of this field.

It can be said that if the existing businesses of Igret are done separately, it is difficult to achieve too much scale for each.

However, the concentration of all these businesses together immediately gave Igreat a powerful synergy and monopoly advantage.

Basically, when other companies of the same type are still struggling to explore the business model or do everything possible to pursue more market share, relying on their own advantages and the mature business model provided by Simon, the boss, based on memory, Igrid easily Most of the revenue in related fields is easily taken into his arms.The data center business with the lowest share also reached more than 50%, advertising revenue also accounted for more than 90%, and the software business was almost exclusively.

Simply put, the entire industry is frantically burning money in order to divide up the Internet's rapidly rising big cake, and a large part of these burning funds are in the hands of Igrith.

According to estimates by the industry at the beginning of the year, in 1994, only VC investment in the field of new technology reached 17 billion U.S. dollars, of which the United States accounted for 70% of the share. Most of these VC investment targets are Silicon Valley startups. Internet companies, whether they create websites, develop products or conduct marketing, can't get around Igriat.