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Chapter 167: Conflict Among People
Several investors from Sabin City were feeling a bit uneasy.
Strictly speaking, they belonged to the same Progressive Party faction as the capitalists from Kurland City sitting on the other side. Often, they maintained a sharing attitude in terms of resources and information.
This political alliance gave them an advantage over capitalists with no faction or those who were neutral, allowing them to potentially form a temporary alliance under the influence of certain powerful figures.
However, they couldn't be considered a single group since they hadn't always shared the same interests, especially now when these people were here to snatch business opportunities, making it impossible for them to form a close bond.
What truly made them uneasy was their public valuation of the Interstellar Trading Company at seventy million. Whether or not Mark really invested two million for a 3% stake, this valuation could not be lowered.
This wasn't related to Mark; if the valuation decreased, Mark's shares would increase, and they might have to exceed their budget to acquire more equity.
Everyone knew that whoever held the most shares in a company had the loudest voice, the most support, and could decide everything within the company.
Entrepreneurial companies often had a love-hate relationship with investors and investment firms because their equity was often lower than that of these firms, leading to the ironic situation where many founders were eventually ousted by the board.
Their initial plan was to negotiate the valuation down and then collaborate with Lynch to inflate the company's market value continually.
They weren't worried that Lynch would disagree because this method was faster and more profitable than steadily doing business.
Raising a company's market valuation was essentially no different from inflating the price of a piece of art, continually trading it to increase its perceived value.
However, inflating an antique's value was about waiting for a fool, while inflating a company's value was about waiting for a group of fools after it went public.
Currently, in the Baylor Federation and worldwide, many capitalists were transitioning from traditional business operations to capital maneuvers, no longer pursuing the value of goods but rather value itself.
They initially thought they could obtain more shares from Lynch with relatively little money and other resources.
But competitors appeared. If they lowered the price, the other side could also achieve more with less money (gain more equity). Once both sides started competing, conflicts would intensify, leading to greater losses.
Not to mention that there was still a worrisome young man, Lynch.
If they still thought Lynch was just a lucky boy, they would be truly foolish. Arranging for both groups to meet either showed extreme stupidity or cunning.
Undoubtedly, Lynch didn't seem like a foolish young man. Quietly securing Mark indicated that they had misjudged him.
"Everyone is here for my company..." Lynch, smiling, took a sip of coffee. The slightly bitter taste was followed by a rich aroma, perfectly roasted. He put down the cup, leisurely looked at both parties, and continued, "I do not reject others investing in Interstellar Trading Company. I never believed one could succeed alone; success always requires some help."
"If I succeed, you will be the ones who helped me, and vice versa, if you succeed, I will be the one helping you."
This set the tone for the small meeting, which was to agree to investment and equity acquisition, leaving no room for objection.
These federal capitalists, driven by wealth plundering, even pushed for legal clauses requiring companies valued over ten million to have multiple "shareholders," aiming to forcefully acquire equity.
Lynch didn't oppose investment but warmly welcomed it, yet they felt a bit uneasy for some reason.
He then moved on to the core issues, "Actually, I brought everyone together because I don't want to repeat certain things. I hope you can understand me. After all, I'm young and sometimes can be quite impatient."
After glancing at both groups and seeing them express their understanding, he nodded slightly, "In my eyes, my company is undoubtedly the best in the world, but I also understand that's not objective. We must respect the market's choice."
"Not long ago, Mark, a famous young entrepreneur from Sabin City, acquired 3% of my company's shares for two million. I believe this is a relatively reasonable price. What do you think?"
The Sabin City investors were unable to respond to Lynch's words. The seventy million valuation was their own publicized figure, and they didn't dare to ask Mark if he really paid two million.
If Mark indeed paid two million, these businessmen from Sabin City would face the mayor's wrath for causing him to lose money.
So they pinned their hopes on the businessmen from Kurland City, hoping they could help lower the price for the first time.
However, their silence gave the Kurland City businessmen the impression that what Lynch had just said was basically the truth. After all, the businessmen from Sabin City didn't object the statement.
They didn't know much about Lynch's company since it was in another city, and in this age of limited communication, people only paid attention to what interested them.
Moreover, the mayor's personal secretary, Noah, had subtly indicated his optimism about Lynch's company, signaling them to acquire part of Lynch's company shares, enough to secure a seat at the board meetings.
Once they acquired enough shares, they could force Lynch to invest more in Kurland City, creating more jobs, through the pressure from these shareholders.
It must be said that being a politician in the Federation sometimes wasn't easy. A qualified politician needed to understand politics and its rules and have sufficient economic knowledge.
These people came with simple goals. Seeing the other side remain silent, implicitly accepting Lynch's statement, they naturally didn't say anything either.
Both sides' silence somewhat surprised Lynch, who expected them to start suppressing his valuation. He even planned to concede on price later, splitting the business into three companies, making them pay the same amount.
But their tacit acceptance made Lynch find them rather adorable, adorably foolish.
He nodded and patted the sofa's armrest, essentially finalizing the matter, leaving only the negotiation of the amount and payment method.
"At least half of it in cash, that's the bottom line..."
Finally, someone interrupted Lynch, and it was the businessmen from Sabin City. They felt if they didn't speak up, the other side would continue to foolishly remain silent, making things irreversible.
So, they had to speak.
"That's impossible, Mr. Lynch." The speaker was a tall, thin businessman.
Often, when thinking of capitalists, people would imagine slightly balding middle-aged men with greasy skin, but cunning and slick personalities.
However, this was a product of the times. Most capitalists maintained healthy bodies, with personal managers or others helping them manage their health. They also had enough time and money to use the most advanced and scientific methods to address health issues.
As some scientists said, the world's most cutting-edge technological inventions were created to better serve the wealthy, never considering ordinary people.
Moreover, the more successful the capitalist, the more disciplined they were. So it was rare to see obese capitalists in this era.
Lynch looked at him, and the tall, thin man fearlessly met Lynch's gaze. Considering the significant additional money he stood to lose, he felt like he was bleeding internally. And now, Lynch wanted even more. Naturally, he wouldn't agree—there was simply no way.
After showing strong opposition, his tone softened slightly, "Mr. Lynch, you know the current situation. Cash is increasingly difficult to recover, and we have many other contingencies to handle..."
Others nodded as well. Recovering funds was difficult, but spending money was easy. Merely paying various salaries, utilities, or site management fees each month gave them headaches.
If Lynch demanded such a high cash ratio, some of them might instantly face cash flow difficulties, even breaking the capital chain.
So, a 50% cash ratio was absolutely unacceptable.
Lynch looked at him, "Then what do you think is appropriate?"
The tall, thin man proposed a pre-discussed result, "Around 15%, that's a reasonable ratio."
Lynch shook his head, "No, too low. I can't agree."
The tall, thin men appeared to confer, then raised the ratio by two points, "17% cash. That's our utmost sincerity."
Lynch stood up, patted his trousers, and looked down at them, "I drank some wine tonight, my mind's a bit foggy. I think we need to reconsider this issue, maybe talk tomorrow or the day after."
The tall, thin man was resolute, "Even if we talk tomorrow or the day after, this ratio won't change much."
Lynch scoffed and left.
These tricks were known to him early in his career. They didn't care about the company's valuation because they never intended to spend much to buy shares.
Lynch couldn't help but feel that Mark was a kind, honest kid, while these seemingly weak capitalists were the true wolves.
Their tricks weren't special. A company's value comprised many factors, but its net worth was a straightforward indicator.
However, no company would discuss net worth because many operated on bank loans as annual revenue, with debt financing being normal, avoiding the net worth topic.
A company valued at a hundred billion might have its net worth drop to millions, or even negative, upon disclosure.
Therefore, capitalists cleverly introduced the concept of "expected value" into market valuation, which essentially meant counting potential future earnings into the company's current value, creating a short-term market valuation and selling it to people as the company's value.
Even if Lynch valued his company at 100 million, these businessmen wouldn’t find it troublesome. The solution was simple: they would just create another company valued at 100 million and then exchange shares to acquire a stake in Lynch’s company.
If this new company suddenly went bankrupt in the future, it would only be due to poor management, and Lynch shouldn't blame them.
As for the shares they held in Lynch's company, they could offset them against third-party debt. In other words, it was possible to take over a company without spending a dime.
So, no matter how high Lynch valued his company, these people weren't worried—they would always have a way.
The real headache for them was Lynch's demand for a cash ratio, which was real money with no room for tricks.
Be it one-buck bills or hundred-buck bills, cash was cash.
Their initial plan was to acquire at least 30% of Lynch's company for around two million. However, with the valuation unchanged, they could only manipulate the cash ratio.
Even now, according to their plan, with about three to four million in cash, they could get 35% of Lynch's company, valued at seventy million.
It sounded like a fantasy, buying shares worth over twenty million with just three to four million, but this was a common tactic in the capital market. They would use various company shares and property rights, supposedly worth around twenty million, for exchange.
Note, it was “supposed worth”. The financial market ws full of risks, and some things could lose value overnight.
However, this time they might not achieve their goal. When it comes to cunning and deceit, Lynch was definitely superior.
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