"How is Android Company doing?"
"That company? When we found them, Android was very happy to hear that we were interested in investing..."
Ivanta smiled and said:
"Before this, they had already approached many venture capital companies, but were rejected by all of them, including Google. Although the other party expressed its support for them, there was no substantial result. According to Michael Fadden, who is one of the founders of Android, they were even preparing to go to Asia to seek investment from hardware manufacturers such as Samsung and HTC. Yes, when I met with them, they had already booked their flights for two days later..."
Android was founded in October 2003. The initial development direction of this system was to build an operating system for digital cameras, but later it turned to mobile phone systems.
By January of this year, Android was in a financial crisis and urgently needed funds to continue research and development of the mobile phone system, but they sought venture capital everywhere but ended up in failure.
In 2004, global PC shipments were 178 million units, while mobile phone shipments were 675 million units, almost four times that of PCs. However, the processors and memory of mobile phones are only comparable to those of PCs in 1998.
Therefore, when they announced that they were developing an intelligent operating system for mobile phones, many companies thought it was a fantasy after seeing the size of their team.
After all, at that time, Samsung had more than 300 people developing their own operating system, while the Android team had only a few people...
Prior to this, in order to seek investment, the Android team locked on several venture capital firms, most of which were located on the East Coast, far away from Silicon Valley.
In the original time and space, a book about Android Corporation once described this history:
"Mike Fadden used to travel back and forth on a main road in western Silicon Valley, pitching Android as a camera operating system to these investors, but was always rejected..."
After that, they targeted venture capital firms that they had not yet introduced to, and while contacting these venture capital firms, the Android team also met with Google.
In early January 2005, Google co-founder Larry Page invited Michael Fadden to meet at Google.
Page was a fan of the T-Mobile Sidekick phone produced by Michael Fadden's former company, so he wanted to talk to Michael Fadden about trends in the mobile industry.
It was a smaller meeting, with just McFadden and Sears on the Android side and Page, co-founder Sergey Bourne and early Google employee George Harrick on the Google side.
The meeting was casual, but Google was clearly interested in what McFadden and Android were doing.
At the end of the meeting, the founder of Google said:
"We want to help you."
It has to be said that the meeting with Google was encouraging, but for the Android team, the reality is that the meeting did not achieve any substantial results.
So they hope to find more potential investors, including mobile phone manufacturers Samsung and HTC.
But at this time, Ivanta and the IC Capital team found them.
At this time, IC Capital's popularity in Silicon Valley grew day by day because of its acquisition of the former Internet advertising giant DoubleClick for US$1.1 billion.
Therefore, in the face of the goodwill shown by IC Capital, this round of financing was quickly completed and the process was very smooth.
IC Capital will invest $20 million to acquire a 45% stake in Android.
At the same time, they obtained an additional clause in the investment agreement signed with Android, that is, IC Capital has the right to anti-dilution in proportion to its shareholding in subsequent financing, and has priority under the same conditions.
And when Android faces an acquisition, they have a veto power, provided that they acquire the remaining shares at the same price as the other party.
In the original time and space, Android was acquired by Google for US$50 million on July 11 this year after three meetings with the company.
However, before the second meeting between the founder of Android and Google in March, IC Capital entered the market in advance and completed its investment in Android.
Barron naturally understood the future importance of Android. As for why he didn't directly acquire Android like Google did in the original time and space?
Because the Internet resources that Barron currently possesses are far inferior to those of Google, he is not sure whether he will still be successful if he completely acquires the company - after all, in the original time and space, Google acquired Android and it took a period of development before launching the Android mobile phone system.
And in terms of the enthusiasm of the founding team, Google's complete acquisition of Android can incentivize them with Google stock.
But what about IC Capital? After completely acquiring Android and causing the founding team to lose their shares, will IC Capital be able to replicate the success of the original time and space in the process of developing the Android system?
No one can guarantee it.
In fact, Barron's positioning for IC Capital is to invest in projects that have great potential or can be sold at a good price, but at this time conflict with some of his industries through this investment company managed by Ivanta, which does not appear to have any connection with him.
For example, MySpace could be sold to News Corporation at a high price in the future, but it is still a competitor of Woaw Technology...
YouTube will also compete with DailyVedio in the future...
The same is true for Android. DS Capital is a major shareholder of Apple. After DS Capital and Rich23 Capital together held more than 30% of Apple's shares, private equity funds under DS Capital, including the Mars Fund, have also been increasing their holdings of Apple shares.
As we all know, in the future, Apple and Android will be each other's biggest competitors in smartphone operating systems.
Therefore, it is not convenient for companies related to DS Capital to directly invest heavily in and support the development of Android.
This could easily sour the relationship between Apple and it in the future.
Therefore, Barron invested in Android through IC Capital and did not choose to acquire it completely like Google, which also left room for future investment in Google.
Yes, at this time and space, it is naturally impossible for Google to complete the acquisition of Android.
But if they want to invest in this company, IC Capital will still allow it, but the prerequisite is that they will be given enough interests in the future Android company.
Whether it was investing in Android in advance or requiring additional terms in the agreement, these were all preparations made by IC Capital.
The 45% shareholding ratio also enables IC Capital to attack or defend in the future battlefield of Android companies.