Chapter 990: A Prophecy Comes True
A month later, a new Internet company was quietly established.
The company is registered in Santa Clara, California, which is part of Silicon Valley and is located on the west coast close to San Francisco, with extremely convenient transportation.
There are three shareholders in this company, namely Jerry, his friend David, and Zhang Hao who just joined.
Compared to before, when Jerry and David first started working on the Internet Guide Navigation website, they only had a trailer at their alma mater Stanford, and later moved to David's garage. Now, with Zhang Hao's participation and capital injection, the newly established company finally has a formal office space. Although the office is not very large, it is much better than the previous poor working environment in the trailer and garage.
Before the company was established, Zhang Hao took time to go to California and met with Jerry and David. After the three met, they discussed the subsequent investment and the establishment of the company. Zhang Hao admired Jerry and David's abilities, and they all had technical backgrounds and were of similar age. It can be said that they had a good chat and finally decided to invest in the establishment of the company. In this way, Zhang Hao invested $1.5 million in capital as the company's founding shareholder, holding 38% of the company's shares, and 52% of the other 62% of the shares were equally held by Jerry and David, and the remaining 10% of the shares were used as employee shares to recruit technical talents.
In addition, David served as the chairman of the company and Jerry was the CEO of the company. As for Zhang Hao, he was much more low-key. He rejected Jerry and David's request for him to serve as chairman, and even gave up the CEO position to Jerry, only accepting the position of CTO, or chief technology officer.
This is also taking into account the previous problems of Netscape. As Zhang Hao was the chairman of Netscape, and because he was Chinese and had not yet become a naturalized citizen, he eventually gave up control of Netscape under pressure from the Immigration Bureau, and thus lost most of Netscape's shares.
Jerry and David do not have this problem. Jerry has already obtained American citizenship, and as for David, he is an American, and a Westerner at that. Having the two of them as the leading figures of the company is much better than having himself standing in the front.
After the company was established, the three held a meeting to determine the current product direction and technology upgrade goals. Subsequently, the company began to form a professional technical team. Although Jerry and David were complete newcomers in the Internet industry, Zhang Hao served as CTO. Although Zhang Hao was not well-known to ordinary people, many people in the industry knew who Zhang Hao was. In addition to Netscape's connections and relationships, this technical team quickly recruited several outstanding talents and was successfully established.
With the joining of Zhang Hao, the company embarked on a path of rapid development. With the support of the technical team, many problems existing in the previous Internet navigation guide website were improved, and the website was upgraded and the columns were optimized. In addition, changes were made to the technical algorithms to enhance the search function.
In addition, the database was updated and expanded, and Zhang Hao brought some convenience to the website through his relationship with Netscape. In just less than two months, the updated website was very different from the original one, attracting many users as the first choice for Internet navigation websites.
In addition, at Zhang Hao's suggestion, the website was segmented into portals, providing new functionalities through the combination of network links and browser functions, so that Internet users only need to open one of their websites to find what they need on it.
As a result, after the update and upgrade, the number of users visiting the website every day began to increase continuously, and quickly soared from the initial several thousand visits to nearly 100,000.
As the number of visits increased, Zhang Hao proposed to use advertising to convert visits into a revenue model, thereby upgrading the website again. After the upgrade, the website launched its first advertising business, which also brought the company initial revenue. Although compared with the current investment, this revenue is not much, only a few thousand dollars, but for the three people in the company, this is a huge breakthrough, indicating that the website already has the ability to convert visits into real revenue.
In the operation of the company, Zhang Hao did not devote all his energy like he did in Netscape, because this company is different from Netscape. Although he is the founder and investor of the company, in fact, Jerry and David had built this Internet navigation guide website long before the establishment of this company. This website is the foundation of the establishment of the company. Jerry and David are the real core of the company.
After the Netscape incident, Zhang Hao was very cautious about his second venture, so he declined the position of chairman and CEO and only served as CTO. He knew that if the company was small, his identity would attract the attention of the immigration bureau again. He didn't want to make the same mistake twice, so Zhang Hao determined his position from the beginning. In addition, he had just returned to school and had to continue his studies. He didn't have much energy to focus on the company. He had to finish his studies first, which was the most important thing for Zhang Hao at the moment.
Time flies and it is already the second half of 1995. Shao Heping now particularly admires Song Yuanchao's vision and judgment. At the beginning, Song Yuanchao took the initiative to withdraw from the preparation and establishment of the Development Bank. At the same time, he pointed out the inherent deficiencies and potential problems of this bank and warned Shao Heping.
Before, Shao Heping could not say that he was completely sure of Song Yuanchao's judgment, and he was only half-believing and half-doubting what Song Yuanchao said. But over the past year or so, with the establishment of this bank and a series of actions after its establishment, Shao Heping is now completely convinced, because the problems that Song Yuanchao reminded him of at the beginning have all become reality.
Since this bank had a high debt when it was first established, and because of the bursting of the real estate bubble in Qiongdao, the local government, banks, credit unions, trusts, etc. suffered heavy losses, and the proportion of debt on hand was extremely high. The original intention of establishing this bank was very clear, which was to solve these problems and help these institutions get out of trouble.
As a result, the bank had a high amount of debt at the beginning of its establishment, which was completely contrary to the basis for the good operation of a normal commercial bank. Moreover, after the bank was established, in order to absorb savings and introduce funds to solve the debt problem, the commercial bank announced a much higher interest rate than other banks.
Generally speaking, some banks with high interest rates offer a three-month fixed deposit interest rate of 6.66%, a six-month fixed deposit interest rate of 9.0%, a one-year fixed deposit interest rate of 10.98%, a two-year fixed deposit interest rate of 11.70%, and a three-year fixed deposit interest rate of 12.24%... These interest rates are already very high for the banking industry, but in order to attract depositors' funds, commercial banks have actually offered a maximum three-year fixed deposit interest rate of 25.5%, which is almost double the current highest interest rate in the banking industry for the same period of time.
You have to know that even if you are doing business, and a good business, you may not necessarily get a stable return of 20% in a year. But now, as long as you deposit the money in a commercial bank, you can get a stable annual interest income of 25.5%, which is many times better than doing business.
After all, business has its ups and downs. No matter how capable you are, you cannot guarantee that your business will only make money. In addition, you need to put in a lot of effort to make money. But now, you can get an annual return of 25.5% without doing anything. With such a good thing, who would still work hard to do business?
When the deposit interest rate of this bank was announced, countless people immediately lined up to withdraw their money from other banks and deposit it in this bank.
And as time goes by, more and more people do this, not only from Qiongdao, but also from other provinces who bring money here to deposit.
That's not all. Even some leaders of the municipal bureau were attracted by such high interest rates. They privately found Shao Heping to discuss whether they could deposit the funds that were not currently being used into this bank to earn interest. You know, the bank's interest rate is too high. Not to mention the three-year term, even the one-year term is nearly 20%. Don't the various agencies lack money now? Put the money in first and get some interest! As for the current difficulties, they should be overcome for the time being. When the interest is in hand, more things can be done.
Not to mention, there are many people with this mentality. Even Shao Heping's deputy proposed this suggestion at an internal briefing. But these suggestions were directly rejected by Shao Heping. Not only did he reject them, Shao Heping also specially called all the heads of the municipal bureaus to a meeting. At the meeting, he solemnly stated that no one could use the funds in their hands to deposit them in this bank to earn interest. The government 's funds must be opened in a bank designated by the government. If anyone does this, he will skin them! At that time, let alone earning interest, let them eat steamed bread directly!
Shao Heping's tough attitude and his tone that did not tolerate vetoes surprised everyone. Some even expressed their incomprehension and dissatisfaction with Shao Heping's behavior. For this reason, many people criticized Shao Heping behind his back. Even his comrades in the city privately advised Shao Heping that there was no need to do so. Not only would it not unite his comrades, but it was also a one-man show, which was really undesirable. In addition, Shao Heping had agreed to the establishment of this commercial bank, but now he was using this method to not support the operation of the commercial bank. Isn't this going back on his word?
Who would have thought that the more this happened, the more Shao Heping refused to give in. He even set up a supervisory group with himself as the team leader, strictly enforcing the decisions he made at the meeting. Once he found any violations, he would punish them or suspend them. After these few moves, everyone was complaining, but at the same time, they gradually gave up the idea of taking this opportunity to "generate income."
As the current head of Lucheng, Shao Heping knows some things better than others. When the commercial bank was established and used such high interest rates to attract depositors, Shao Heping learned some things that outsiders did not know through his channels.
The more he learned, the more worried Shao Heping became, because after learning more, he found that what Song Chaoyuan had mentioned was indeed happening. While commercial banks were desperately trying to attract depositors with high interest rates and thus obtain a large amount of funds, they did not operate these funds through investment, lending, etc. according to normal banking operations.
To put it bluntly, a bank is just a platform that absorbs savings on the one hand and makes profits through investment, lending and other means on the other hand. Banks have to pay interest on savings, and get corresponding returns in investment and lending.
For example, the normal fixed interest rate of a bank is now as high as about 10% per annum. Therefore, the income obtained by the bank from other financial operations such as investment and lending must be higher than the annual savings interest. Adding other cost expenditures of the bank, the return must be at least 15% to maintain balance.
When the bank's fixed interest rate reaches 20% or even 25.5%, then the capital gain must be at least above 30% to be maintained. The problem is that it is impossible for a bank to have such a high and stable capital gain. The highest interest rate for external loans from several major banks is only around 20%. Unless the bank directly changes its business to loan sharking, people who want to borrow money are not stupid. There are so many banks out there, and the interest rates of loans from other banks are not high. Why would they come to you to borrow money at such a high interest rate?
