Chapter 482: $4 Billion Valuation! $500 Million Financing

Chapter 482: Chapter 399: $4 Billion Valuation! $500 Million Financing

Typically, platforms like Jingdong and Taobao love to boast about their GMV breaking the trillion-yuan mark. To outsiders unfamiliar with the term, this sounds incredibly impressive, but industry insiders know that GMV is a completely different beast from actual sales revenue.

However, based on Pinduoduo’s GMV trend chart and projections, it was quite possible for their total sales to break 100 billion Huaxia Coin this year!

All eyes were on the big screen. Even those who knew Pinduoduo’s numbers were good couldn’t help but marvel. ‘Pinduoduo is growing at an incredible speed!’

Keep in mind, Pinduoduo had been founded less than a year ago, and these numbers already placed it among the top ten e-commerce platforms.

This ranking wasn’t just for platforms selling goods, but also included service platforms like Meituan.

Pinduoduo’s growth was a classic case of the stars aligning—the right time, the right place, and the right people—to achieve such results.

Some couldn’t help but glance at the young man in the head seat. He was the one who had single-handedly created this dark horse, Pinduoduo.

Before this, many had tried to break Taobao’s dominance, but only Jingdong had managed to successfully break through the blockade.

Soon, it seemed a triumvirate in e-commerce might actually become a reality.

“Although we’ve generated three billion in revenue to date, we are still operating at a loss. Since January 1st, we’ve lost 500 million Huaxia Coin.”

“But we are confident that once Pinduoduo captures the market and builds a massive active user base, we will eventually become profitable and go public! That concludes my presentation! Thank you!”

The moment Zhou Shen finished speaking, the room erupted in enthusiastic applause.

Afterward, Wu Yun said with a friendly smile, “Now that everyone is on the same page, let’s move on to the next item on the agenda!”

At Wu Yun’s cue, Tencent’s representative, Li Chaohui, was the first to stand. “Based on our comprehensive assessment, we have decided on a valuation of US$3.5 billion for Pinduoduo! Tencent intends to lead this Series B round!”

Wu Yun nodded. He had already discussed this with Tang Hongjiang. Nirvana Investment’s internal assessment had valued the company in the range of US$3.5 to US$4 billion.

‘So Tencent’s offer is on the low end,’ Wu Yun thought. ‘And they want to be the lead investor. Looks like they’re trying to grab a larger stake.’

But no matter who led the investment, Wu Yun had no intention of losing his controlling stake. He’d seen too many cases of founders being pushed out of their own companies by capital.

Besides, with his System, Wu Yun wasn’t short on cash.

Of course, even if Tencent led the round and Nirvana Investment didn’t participate, it would still maintain a controlling interest.

Just then, Zhou Shuwen stood up. She gave a faint smile, though to an outsider it looked more like a sneer. “President Li, you people at Tencent certainly drive a hard bargain! I bet they can hear your abacus clacking all the way from your headquarters in Peng City!”

“While we at Revitalization Capital have no objection to Tencent leading the investment, we do take issue with this valuation! I promised President Wu I was prepared to come in at a premium. Therefore, Revitalization Capital is willing to offer a valuation of US$3.8 billion!”

Wu Yun shook his head. ‘So much for our special relationship,’ he thought. ‘When it comes to this, it seems business is business.’ After all, Revitalization Capital wasn’t her personal fiefdom.

These investors all talked a good game, but their actions told a different story. Every penny counted, and none of them were here to be played for a fool.

Wu Yun then nodded to Tang Hongjiang, who had been sitting calmly on the sidelines, signaling that it was his turn to make a bid.

Tang Hongjiang laughed heartily. “The valuations from both of you are indeed in line with the market,” he said, “but you’ve forgotten one crucial thing: Pinduoduo’s potential!”

“Pinduoduo is destined to be the third pillar of the e-commerce world! But let’s put that aside. Based on this year’s projected sales of 100 billion and a GMV of 150 billion, a valuation of US$4.5 billion is hardly an overstatement!”

“Pinduoduo is a crucial part of Tencent’s strategy for the widespread adoption of WeChat Pay, and I’m confident Pinduoduo will achieve profitability very soon! Therefore, my valuation is US$4.5 billion!”

Tang Hongjiang’s words lit the fuse. Instantly, the three parties began to clash over the valuation.

With his professionals handling it, Wu Yun didn’t need to join the fray himself.

He simply sat back and watched as the representatives stated their cases and refuted their opponents.

Wu Yun could have sworn he saw spit flying from Tang Hongjiang’s mouth, nearly hitting the Tencent representative across the conference table.

An hour passed. Then two. Then three.

At one point, Wu Yun even stepped out to use the restroom.

As noon approached with no end to the arguments in sight, Wu Yun had Zhou Shen follow the agenda and arrange for lunch.

Zhou Shen switched on the conference room microphone. After a couple of puffs to test it, he said, “Everyone has been working hard! We’ve arranged a working lunch, so please take a short break. We will resume with a second round of negotiations after the meal!”

‘Of course,’ Zhou Shen thought, ‘the higher the valuation, the better.’ It would make the shares he held that much more valuable. Even if his stake wasn’t huge, the price per share would be astronomical.

At Zhou Shen’s announcement, the three parties, who had been arguing until they were red in the face, instantly regained their professional, “urban elite” composure. They straightened their clothes and smoothed their hair. Acting as if no heated argument had just taken place, they exchanged false smiles and walked out of the conference room together toward the designated lounge area.

Since the day’s agenda was to finalize the financing as quickly as possible, it was indeed a working lunch. The real celebration banquet would have to wait until after Pinduoduo’s Series B round was successfully closed.

During the meal, everyone had a tacit understanding not to discuss the morning’s meeting. Some ate in silence, mentally preparing for the afternoon’s battle. Others made small talk with those next to them—regardless of which side they were on—discussing national affairs or industry trends.

Soon enough, the one-hour lunch break was over. Everyone returned to the conference room, refreshed and ready for round two.

Many Pinduoduo employees eyed the closed conference room doors with curiosity.

Some even made a point of walking past the door, as if trying to eavesdrop on the arguments inside.

However, the conference room was well soundproofed. That, combined with so many people talking at once, meant they could only hear a low, buzzing murmur.

“Xixi! Did you hear what they’re fighting about?” a stylishly dressed woman asked, her face alight with gossip.

The Pinduoduo employee named Xixi, who had just “casually” walked past the door a few times, looked defeated. “I couldn’t hear much! Just something about ‘billions’! Looks like the financing is going through! It’s just a matter of valuation. Yang Ling, what do you think the number will be?”

The woman called Yang Ling sighed helplessly. “How should I know? I’m not in finance! But as a Pinduoduo employee, I obviously hope our company’s valuation is as high as it can be! If we go public soon, I’ll definitely buy some stock!”

“After this financing round, President Wu’s net worth is going to explode!”

“Why are you so worked up? It’s not your money! Just focus on your own work!”

…

After several more hours of debate, Pinduoduo’s Series B valuation was finally set: US$4 billion.

As the lead investor, Tencent invested another US$300 million. Nirvana Investment and Revitalization Capital each put in US$100 million, for a total capital injection of US$500 million.

After the Series B financing, Pinduoduo’s equity structure underwent a major shift. Wu Yun’s—oh, that is, Nirvana Investment’s—stake was diluted to 66.22%, while Tencent’s share increased to 24.44%. Revitalization Capital now held 2.22%, and the employee option pool was diluted to 7.11%.

The contracts were signed quickly, with all three investors promising the funds would be transferred within five business days.

The news of Pinduoduo’s successfully completed Series B financing, along with a group photo of the key players, was posted on Pinduoduo’s official website.

Soon, the news spread like wildfire throughout the investment community, and it was already starting to break into the mainstream.