Chereads / REVIVE: AMERICA 1995 / Chapter 13 - Chapter 13: Planting Seeds in the Internet Frontier

Chapter 13 - Chapter 13: Planting Seeds in the Internet Frontier

While Zeta-Jones was conversing with her new friends, it was midday in Santa Clara, California.Santa Clara was already a well-known part of Silicon Valley, one of its more important constituent cities. Like other places in Silicon Valley, it was home to numerous startups. "Jerry, do you think the new investor will interfere with how we do things?"David Filo looked somewhat anxious, unable to relax due to his worries. He asked Jerry Yang, who stood beside him in a sharp suit, his expression serious."David, I know what you're worried about, but I think as long as he's reasonably intelligent, we shouldn't have too many personnel changes," Jerry Yang replied.Jerry Yang understood David Filo's concerns. He himself was also nervous. Their company had been founded the previous year, securing five million dollars in seed funding from Sequoia Capital.So far, they'd spent four million of that five million. As for output…Not to mention the pioneers of the early internet era. Even internet companies twenty or thirty years later mostly relied on burning cash to maintain a presence in their early stages.The number of internet companies that actually managed to burn their way to profitability was less than one in a hundred.But the current situation was different from the future.Later on, so many internet companies could burn money with peace of mind. This was because, in the early days, many internet companies had burned their way to success, generating returns for investors.With these shining examples, later companies could confidently burn money.But now, it was 1995. The first global internet IPO was still a month away. People were skeptical about its success. Financial experts and media outlets questioned it daily.These fledgling Silicon Valley companies, even if they wanted to tell a compelling story, even if they had the talent to spin a fantastic yarn, had no templates to follow, nothing concrete to boast about.This was why the two founders of Yahoo felt nervous upon hearing that Sequoia Capital was bringing in a new investor."They're here."David Filo saw several cars driving towards them and alerted the others.The cars slowly came to a halt, and a group of people got out first.Jerry Yang and David Filo recognized these people. They were the ones who had been involved in the negotiations over the past few days. The leader, Wendy Aris, was a very tough negotiator.Following them, a young man in a t-shirt and jeans stepped out of the car, looking around at the surroundings and the company's location.A five-story old building with peeling paint gave a sense of decay."That must be the young man. He's so young. Being rich is truly something else!"David Filo's mind raced with various thoughts, but his feet didn't stop moving as he hurried forward to shake hands and greet Milo.Jerry Yang followed closely behind David Filo. They were equally surprised by Milo's youth.After Wendy's introductions, the two sides shook hands, exchanged brief pleasantries.Led by David Filo, the group entered Yahoo's office.Yahoo's office space was quite spacious, but there weren't many employees.Milo knew that Yahoo currently had just over fifty employees.Fifty-some people using a five-story building meant that the space available to each person was quite generous, even somewhat luxurious.At that moment, all of Yahoo's employees, like the two founders, were somewhat tense.These early pioneers of the internet industry hadn't yet developed the peace of mind that later generations would have when burning money.The five million dollar investment would last about a year. But the company had yet to make even a single cent of profit. And it was clear that Yahoo wouldn't be profitable for a long time.Many companies in Silicon Valley were in the same boat. Many went bankrupt after running out of money.Yahoo needed to secure new funding.The other party was Yahoo's angel investor, brought in through a referral from Sequoia Capital.Whether it was the two founders, David Filo and Jerry Yang, or the company's other employees, everyone longed for the investor's dollars; otherwise, the company would struggle to survive the year.The atmosphere in the meeting room was a bit tense. Milo remained silent, idly flipping through the documents, plans, and proposals that Yahoo had prepared for the investors.From a contemporary perspective, they seemed somewhat fanciful.But as someone from the future, Milo knew that although Yahoo would decline and eventually fail, it was undoubtedly the representative of the global internet for the next five years.At its peak, its market value had reached over 120 billion dollars.After confirming that the Yahoo before him was the Yahoo, he didn't wait for the two internet pioneers to deliver their long-winded pitches for investment.He waited for Wendy to lead the auditing team to complete the final calculations.As long as there were no problems, Milo would sign the contract and pay.He would invest five million dollars, just like Sequoia Capital.He and Sequoia Capital would then jointly hold 70% of Yahoo's shares.The two founders would hold the remaining 30%.This heavily loss-making small company with only fifty-some employees would then have a nominal market value of 14 million dollars.A few minutes later, Wendy opened the door and entered.He nodded at Milo, indicating that everything was fine."Then let's sign," Milo said to the two founders with a smile.Jerry Yang and David Filo breathed a sigh of relief.They were also a bit dazed.Was it that simple?They hadn't even exchanged many words, had barely looked at the documents, and they were signing the contract?When the two had sought investment from Sequoia Capital the previous year, it had taken nearly three months.Sequoia had conducted various audits, and the two had visited Sand Hill Road almost daily to lobby them.Only then had they finally secured Sequoia's investment.Facing Milo this time, they had assumed it wouldn't be as difficult as last time, given that Sequoia Capital had already invested.But they hadn't expected things to be this easy, this simple.The conversation hadn't even exceeded ten sentences, and the fledgling Yahoo had received another investment."…This, this is too easy?"Outside the company's entrance, watching the departing convoy of cars, Jerry Yang said to David, a hint of disbelief in his voice.The whole process had taken less than an hour, including the welcoming and farewell pleasantries.Although there had been several days of prior contact, the two founders of Yahoo were still somewhat dazed at how easily the deal had been concluded.Compared to Jerry Yang, David Filo, being white, had access to more information and channels.After thinking for a moment, he said to Jerry Yang, "Five million dollars is a lot of money to us, but it might not be much to him. I heard that our new investor is connected to a Boston financial group.""The Boston financial group!" Jerry Yang exclaimed in surprise.David Filo nodded affirmatively.This was the information he had received from Sequoia Capital.