Shockingly, a counterfeit factory has produced a 3-nanometer chip.

Chapter 92 An Unpleasant Investment

"But this is not about deceiving consumers. Our phones may not make a profit, or even be sold at a loss. But we can still make money through the system, applications, services, etc."

Lin Bin, Lei Jun's longtime partner, immediately understood what Lei Jun meant: "Just like Tencent, QQ is free, but games make money."

"Yes." Rebus nodded. "So I plan to take it in two steps."

The first step is to invest in an existing mobile phone company to quickly enter the market. The second step is to build your own team to make a true internet-enabled mobile phone.

After all, Lei Jun had never worked in the mobile phone industry, so he wasn't entirely clear on how complex the market was or how quickly it changed.

So he had already chosen a lucky one in his mind.

"Who should we invest in?"

"Enchanting Bamboo!"

Speaking of Meizhu, it is a mobile phone company in Guangnan Province. This year, it even released the first domestically produced smartphone without any qualifiers.

The user experience is indeed just average. The price has now dropped to 1999, but sales don't seem to have improved much. In fact, the company is facing some financial difficulties.

Investing in them might be the right choice.

…………

One week later, at Meizu headquarters in Zhuhai.

Huang Zhang, the founder of Meizhu, is also a rather obsessive product manager, but at this moment, due to reality, he is showing Lei Jun a tour of the production line.

At this moment, workers on the assembly line are assembling the M8, which is also Meizu's first product.

"Mr. Lei, look. I designed this home button myself, and the feel of pressing it..."

Huang Zhang was talking at length about the product details, from materials to craftsmanship, from design to interaction logic.

Lei Jun's investment was based on genuine need, hence the detailed explanation of all aspects.

Lei Jun listened patiently, nodding excitedly from time to time. Indeed, the production line was somewhat different from his ideal design.

After a brief tour, the group, as usual, went to the conference room for tea.

To satisfy them, Huang Zhang specially brought out his best tea, the kind that even suppliers usually don't get to drink.

Lei Jun took a sip, found it mediocre, and put the tea leaves aside.

"Mr. Huang, after looking around, the M8 is indeed very well made. Among domestic mobile phones, its industrial design is top-notch, but..."

This isn't just Lei Jun (CEO of Xiaomi) praising the M8; its build quality is indeed impressive, especially at a time when domestic brands are still focused on feature phones and engaging in price wars...

Going all in on smartphones is a bold move.

"But why aren't sales up? It's only sold a little over 30 units in the six months since its launch. Huawei, on the other hand, can sell hundreds of thousands every month, and its cumulative sales are already close to 300 million."

Upon hearing Lei Jun compare him to others, Huang Zhang's expression instantly changed: "Our positioning is high-quality, not mass-market products. And..."

"And what?" Rebus asked, puzzled.

"Is the fact that Taiwan's chrysanthemum factory can sell so many products really due to the strength of its products?"

"It's all thanks to the three major telecom operators. That's where Meizhu suffers," Huang Zhang said with a wry smile.

"We're just a small company, we can't compare to Huawei's position with the carriers. And, well, even though we've tried, most people still buy phones at physical stores."

Selling 30 units is already a pretty good result.

"So your company needs investment," Lei Jun continued, picking up where he left off.

"Shunwei Capital can invest 300 million yuan to take a 20% stake, which means we value Meizhu at 1.5 billion yuan."

This represents a 50% premium compared to other venture capital firms.

With the funds in hand, we can expand production, build distribution channels, and fight GG...

As you know, I have some connections, and I might be able to get your company into offline sales channels, and also bundle some great packages to boost sales quickly.

A flicker of excitement crossed Huang Zhang's eyes. The Meizu M8 had generated approximately 500 million yuan in sales in the five months since its launch, and the total sales for the year were projected to be around 800 million yuan, with actual profits only reaching tens of millions.

This valuation is indeed quite high!

Moreover, Lei Jun promised to enter the offline operator market. With his connections, he might actually be able to.

"Really? Mr. Lei, are you serious? Our Meizhu M8 can be sold to offline operators."

I will do my best.

"Use all your connections, but there are conditions." Leibusi looked him in the eyes, and sure enough, the other party hesitated after hearing the conditions.

"I want to be involved in product definition. No, to be precise, I want to lead the development of the next generation of products."

The meeting room fell silent immediately, and Huang Zhang's smile gradually vanished, replaced by a cold and aloof demeanor in an instant.

"Mr. Lei, you may not know Meizhu," he said.

"I've always been the one who makes the decisions regarding Meizhu's products. From MP3 players to the M8, I've determined every single detail."

This is the soul of Meizhu, and the key reason why so many coal miners choose us.

Huang Zhang is very confident, after all, he really understands design, and many consumers choose his products because of his design.

From MP3 players to today's smartphones...

"I understand."

Lei Jun gave him a forced smile. He said nice things, but all he wanted was to keep a firm grip on the company's control.

They just don't want others to take control of the company.

If things go this way, then Meixing wouldn't be the best choice. But since they were already here, Lei Jun decided to try and persuade them anyway.

"But times have changed. Smartphones are not MP3 players."

It needs software, an ecosystem, and an internet mindset.

Mr. Huang, I admit that your ability to create Meizhu shows that you are a genius in hardware, but in terms of software and ecosystem...

He hadn't finished speaking, but his meaning was clear.

Huang Zhang's face darkened. He was indeed from a humble background. He dropped out of high school, even after being expelled, but he came to Shenzhen at 16 to make a living, and now he has founded a technology company valued at 10 billion RMB…

He's in no way inferior to those so-called academic geniuses; in fact, those people respectfully call him "General Manager Huang." But now, Lei Jun...

He then curled the corners of his mouth into a disdainful smile, gently skimmed off the tea foam with the lid, and said, "Mr. Lei, are you saying that I don't understand software?"

"It's not that I don't understand, it's just that my energy is limited." Leibusi tried his best to put it tactfully.

"I can bring my team in, specializing in software and system optimization, while you focus on hardware design. We'll work together to make Meizu a bigger and better company..."

"No need." Huang Zhang stood up. "Meizhu is my child, and I know how to raise it."

I appreciate Mr. Lei's kindness, but as for the investment... let's forget about it.