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As Meng Lisheng looked at Chen Yuanming, Chen Yuanming was also carefully looking at the man in front of him. In his past life, he had seen Meng Lisheng’s photos in the Economic Weekly website newsletter. The man in those photos always appeared fatigued. Age and puffiness had already changed his temperament, leaving only the desolation of a man in his twilight years.
But this person in front of him was completely different. He looked very young and was about 40 years old. Although he was not handsome, his elegance and the grace of a senior intellectual from the older generation was undoubtedly obvious. In addition, because he had expectations for his future career, his entire being glowed with high spirits.
Withdrawing his hand, Chen Yuanming’s heart was filled with emotion. When he learned that Xiao Junyi’s relative was the father of VCD, his heart was full of surprise and excitement. Now, he had even more thoughts. In those lengthy reports of later generations, Meng Lishen’s entrepreneurial history could be described as mixed. The most common thing was not to praise his contribution to the VCD cause, but the almost sarcastic description of -“the revolutionary martyr”.
Yes, the founder of the world’s first VCD player, the owner of the only independent product in the Chinese home appliance industry, at the end ushered in a total failure of his personal career. In the five years from 1995 to 2000, China created a world-renowned miracle. With just one VCD product, it created a huge market with annual sales of more than 10 billion yuan. The profits were huge, and the density of enterprises was unprecedented. But none of these things had anything to do with Meng Lisheng, because his company fell to pieces as early as 1996 and was overthrown and pushed out of the market by the copycats who followed it.
This was the first person to eat crabs, but he failed to savor the delicious taste and instead hurt his fingers …
With a slight smile, the hand with which Chen Yuanming’s held the gift box tightened a bit. Now seeing Meng Lisheng at this time and place, could he turn things around in the coming future?
Because both sides were a little absent-minded, the scene became awkward. In the end, Meng Lisheng’s wife smiled and welcomed the two into the house, served tea and water and brought out melon seeds and fruits as if they were entertaining members of the younger generation. When she saw Chen Yuanming carrying a gift, she showed a very surprised and slightly happy smile, and put the two big boxes aside.
This busy work finally turned the atmosphere around, but the formal discussion originally envisaged also came to nothing. Meng Lisheng looked bitterly at the materials he had sorted out overnight over the past few days and did not know what to think. He was not really familiar with “venture capital”, but after communicating with Professor Yan in detail, he still chose the most secure method to prepare for war overnight. He prepared materials and tried his best to figure out how to sell his products. He had also listed out a standard profit distribution plan, ready to try to win over this investor.
But now? Meng Lisheng only felt that the information in his hands was abnormally hot, just like a joke. How many tens of pages of information could a child understand? If it was just a young master who had nothing better to do, what had he been worrying about these past few days?
Looking at the two who were having a great conversation with his wife, Meng Lisheng sighed. “Xiao Yi, is this the investor you were talking about?”
“Yes, Uncle Meng.” Xiao Junyi replied quickly, “Yuanming and my uncle spent a lot of time in Shanghai stock trading and their relationship is very good. After hearing about your project, he wanted to fly over to see the situation. This time he has made a lot of gains on the stock market and is thinking of moving towards industry. He is a rare business genius …”
Though he spoke so well, how could Xiao Junyi not see that Meng Lisheng was a bit unwilling to talk at this time? It was because Yuanming was too young. If Meng Lisheng did not know him thoroughly, he would just take this as “sending a child out”, which was basically an insult. However, in this matter, Chen Yuanming was reluctant to seek indirect negotiation with the client, causing such an awkward situation.
But this praise did not get Meng Lisheng’s approval and he was silent for a little while. He turned his head to look at the teenager sitting across the sofa. ” Chen Yuanming, right? I have rarely heard Xiao Yi praise someone so much … But friendship is friendship and business has to be taken seriously. I just want to ask, who are you representing this time?”
Thinking it was a family training their son in business, Meng Lisheng seemed to grasp at a last straw, and in consideration of Xiao Junyi’s identity asked impatiently.
The smile on Chen Yuanming’s face was still kind, but his words were not so amiable “I have let Mr. Meng see a joke. I represent myself. For such an emerging product, I believe my funds can still support it, but what I don’t know is whether the product is worth the investment?”
His tone was not small, and caused Xiao Junyi, who’s heart was already hanging to flash a bitter smile. Why was he being stubborn now? Where was the tact and scheming he showed in ordinary times?
Stunned speechless, Meng Lisheng also smiled bitterly. It really was a young master … but venture capitalists really should have the appearance of venture capitalists. It was not enough to let the other person come to the door, he still needed to show his face to the rich man. It was just that such an investor may not be a good choice …
His heart went back and forth a thousand times, and he finally regained his peace. Meng Lisheng did not pass the pile of information to Chen Yuanming but cleared his throat and introduced it slowly.
“I think you may have heard what Xiao Yi has already said about me. At present, I am working on a project that can replace the laser disc player, which means replacing the current laser disc with a disc called VCD and produce related playback equipment. It has been determined that the VCD disc uses a 120mm disc as a carrier, and the video and audio will be played in full screen simultaneously with a resolution of 352×288 pixels and 25 frames per second. The VCD player can be connected to a PAL TV to play video at 1150kbit per second and audio at 224kbit per second. If the result of the experiment is satisfactory, the video quality will roughly be equivalent to that of a VHS video tape. “
The terminology was quite professional and unpleasant. Xiao Junyi frowned. This was not the attitude of someone intent on really soliciting investors. What he was hawking was not simple, easy to understand or attractive, but appeared to intimidate people with professional terminology.
However, Chen Yuanming didn’t say anything and just pondered for a moment, “Only PAL format, no NTSC format?”
Meng Lisheng was surprised. In fact, he did not expect the child to mention any industry standards. PAL and NTSC were the two major standards for TV signal transmission. TV signals in the United States and Japan were mainly based on NTSC, while in China, Germany, Singapore and other countries, PAL was the standard. Since the player was being sold in China, it was natural to choose the PAL system.
However, as soon as an expert makes a move he would know if there was any preparation. Since the other party had really did some research, Meng Lisheng believed that Chen Yuanming’s sincerity was also more than expected so he explained patiently, “At present, China’s television network has just switched from black and white to color TVs. The requirements of PAL’s receiving equipment are lower, and its color retention is also better. Domestic color TVs use the PAL system thus it is naturally more appropriate to choose it.”
Chen Yuanming didn’t say anything, but just snorted softly.
Seeing that the other party did not refute him, Meng Lisheng continued to say, “At present, a VCD disc can hold about 600m of content, and the duration is about one hour. The cost is much cheaper than laser discs and VHS video cassettes. If there is no accident, it can quickly replace other film and television equipment to become one of the must-have entertainment items for Chinese families. We have done some research into the early stage. At present, domestic sales of video recorders, laser, and audio equipment exceed one million units. If VCD players are put into production, the cost advantage will be quickly displayed. After the product enters the mature period, it is predicted that the annual sales will be around 2 million units! “
This number was tempting, but Chen Yuanming looked unmoved. After thinking for a while, he finally said, “It sounds good, but I have two questions.”
He raised his head and stared seriously into the eyes of the man in front of him. “First of all, how original is this product? Is there a similar product elsewhere in the world?”
Meng Lisheng replied categorically, “That is currently impossible. The MPEG format was developed by my partner Professor Yan. If anyone uses this format to develop new products, he will know it in advance. The originality of VCD is beyond doubt.”
Chen Yuanming nodded. “If so, have you obtained industrial property rights? What about all intellectual property rights, including patent rights and trademark rights?”
“What?” Meng Lisheng was surprised and replied a little awkwardly. “Well … Intellectual property is a very complicated issue. Our product development has already cost a lot of time and money. If we place the rest of our energy on patent application, it will greatly delay the launch of our VCD products, and I am afraid this is not worth the money? “
Indeed, neither he nor Professor Yan had ever thought about the issue of patent application. The problems involved were too complicated, and China’s property rights law was still incomplete. Most people had no patent awareness at all. Who would spend time on it?
Chen Yuanming did not refute, and then asked the second question, “So, if you produce a VCD player, what are your plans for a VCD disc that matches this player?”
This topic was even sharper, and was also the biggest problem they faced. Was it not a joke to build a gun but not a bullet? Moreover, the promotion and sales of the new product was also a difficult point … But for this, Meng Lisheng consciously had a fairly complete answer so he replied with confidence, “This is not a problem, we will contact a group of audiovisual companies to produce certain large number of VCD karaoke discs which will be marketed at the same time as the VCD players to ease people’s unfamiliarity with VCD players and also promote the sale of the related audio-visual companies. “
“Why audio and video, not film and television?”
Wasn’t this too much of a layman question? Meng Li explained with good temper, “The play time is limited. Ordinary movies are more than 120 minutes long and a single-disc VCD cannot accommodate it as such it is more appropriate to adopt the karaoke mode.”
That’s it?… It was only then, Chen Yuanming smiled bitterly. The two questions that had been repeatedly criticized by future generations had just such simple answers. Should the two VCD fathers be considered too naive or too brainy?
Gently shaking his head, Chen Yuanming said the key points of his trip. “As far as the products you have talked about, I am still very interested. If the plan is indeed feasible, I am willing to provide 50 million yuan as the upper limit of venture capital and take up 30% of the company’s preferred shares.”
As soon as the words came out, Meng Lisheng held his breath. This came a little too soon, and it was beyond his imagination. His eyes couldn’t help but look at Xiao Junyi sitting on the side, only to see the other person nod at him. 50 million RMB! Listening to Xiao Junyi’s meaning, this child really has it! If this money is actually invested, it will provide more than half of the capital, but will require only 30% of equity, which is not enough holding to affect management control!
“But …” However, before Meng Lisheng reacted, Chen Yuanming said immediately. “I still have some doubts about this project. There are two problems that must be resolved before investing. The first is patent rights. You must apply for industrial property rights in China and the United States, including invention patents, trademarks, and product appearance. The second is the content and production method of VCD discs, which needs to be re-discussed. If these two requirements are not met, I am unable to throw a lot of money into the water.”
Shocked, Meng Lisheng had no idea what to say? Was Chen Yuanming optimistic about their products, or was he sparing no effort to belittle them? What was the point of these two requirements? Instead of looking at the products, the research lab, and caring about any important things, he spent his energy on side issues. What was this child thinking?!
However, at this time Chen Yuanming had stood up and nodded in a friendly way to Meng Lisheng and his wife, “Thank you for your hospitality, but it is too late today, and it is not suitable to continue talking. I will stay in a hotel here for a week. If you can meet my requirements and have sufficient sincerity to cooperate, you can contact me again.”
The words are light, but the intent to leave could not be refuted. Meng Lisheng stood up and shook hands with the other stiffly, but he pulled Xiao Junyi’s arm while he was seeing them off.
“Xiao Yi, what the hell does this mean today? Why am I being confused by you two? There are two more conditions? Is he alright? Such strange conditions too …”
Patting the back of Meng Lisheng’s hand, Xiao Junyi showed a determined smile, “Uncle Meng, Yuanming’s temperament is a bit weird, but for his vision and ability there is really nothing to say. At this point, the entire Xiao family can endorse him. Since he has given conditions, it means that he really wants to cooperate, and that those two conditions are probably key issues that need to be solved urgently. You may wish to think about it … “
“What?” Meng Lisheng heard a bit of what was being implied. “Isn’t he just a friend of yours who has money to spend on investment? The entire Xiao family …”
Xiao Junyi nodded. “Yes, my father and uncle are quite optimistic about him. Although the Xiao family will not get involved in this business, we will support Yuanming as much as possible if necessary.”
Using the power of the Xiao family to support a teenager, Meng Lisheng no longer knew what to say, and just mumbled and repeated “but that problem …”
Xiao Junyi’s eyes rolled around. “Uncle Meng, you might as well take a closer look at what Yuanming gave you? This child is very skilled, maybe what he wants to say are in those two big boxes.”
After saying this, Xiao Junyi didn’t delay any more. After saying goodbye to Meng Lisheng, he hurried down the stairs and saw Chen Yuanming standing outside and waiting for him.
Seeing him coming, the young boy smiled slightly. “How did it go? Did you back me up?”
Xiao Junyi also laughed, “Fortunately, I did not betray your trust”.”
The smile on the corner of Chen Yuanming’s mouth became even better, and he nodded gently, “Good.”
“But what’s in that box?” Now that the brocade bag has been sent, you don’t you have to hide it anymore, do you? Xiao Junyi asked the same question again.
This time, Chen Yuanming did not keep him guessing and answered directly, “It’s two machines. I think Meng Lisheng will understand …”
*****
Standing at the door, Meng Lisheng did not come to his senses for a long time. Just now the impact of Xiao Junyi’s statement on him was too great. What did the boxes mean? Why could he not understand …
Going home blankly, he sat on the sofa, and thought hard about what just happened. It was too fast, in less than an hour, he had, welcomed the God of Wealth and escorted him out of the door. what had happened in the middle? At this moment, an exclamation was made at the side, Meng Lisheng looked up and saw that his wife had opened the huge gift box and was sighing in praise.
“What’s the matter?” Meng Lisheng asked involuntarily.
His wife turned her head, and the joyful smile on her face couldn’t be covered up. “Look, Chen Yuanming, came with such a valuable gift, a learning machine[1]! I have always heard people talk about this, and I was preparing to buy it for our son! It’s about three or four thousand yuan … “
A learning machine[2]? Meng Lisheng got up from the sofa, “Quick! Open the other box and see what it is!”
Having said that, he didn’t wait for his wife to respond, and ran directly to open the packaging, and after a while, the exquisite gift wrapping paper was torn to pieces, revealing a red and white machine, with two controllers, a console and a cartridge.
“What is this?”
His wife’s confused voice sounded but how could Meng Lisheng not know what was in front of him. This gadget was called a family computer[3]. It is was a home game machine produced by Nintendo in Japan. It was commonly known as the”red and white machine” or “FC”. As an electronic technology researcher, he had seen this thing a long time ago and had also been amazed by the creative ideas of Japanese companies. But what did these two machines represent?
“This thing is called the “red and white machine”, it is a game machine …” Unsure of the problem, Meng Lisheng explained to his wife hesitantly, “The learning machine over there is modified from the red and white game machine and can be used universally. The cartridge of the red and white machine is just an extra controller … “
“Game console? Is that a good thing?” These days, parents are afraid of games like tigers and wolves, and they can’t wait to get rid of all the poisonous weeds that affect their children’s education. I heard that the name of the red and white machine is frowned upon and all those game consoles are banned!”
As soon as this remark came out, Meng Lisheng only felt a thud in his heart and was stunned on the spot. Does that Chen Yuanming mean this?!!
The author has something to say:
Again, the domestic real-life companies and people involved in the plot have all had their names changed to avoid taboos, no one should be offended
[1] Products under the category of learning/Game Machines, including Sony PlayStation, Nintendo Game Boy and Microsoft XBOX.
[2] I suspect this may be referring to the 1990 – Super Nintendo Entertainment System
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it’s impressive for CY to use nintendo to represent his 2 key requirements. nintendo was originally a toy company turned into a hardware company which eventually focused on its games (content) to differentiate against competitors and to entice and lock users in so we can see here how vital good content is as a complement good. nintendo also eventually patented its hardware and games to prevent copycats for the business’s sustainability when they were rampant in the early days. maybe CY also intends to invest in gaming companies in the future as well after VCDs? he asked about the NTSC… Read more »
Thanks for the insight! I had wondered about his motivation so your comment explains a lot!
Being born in 1994, I used VCD’s but I never knew the history or how much they transformed that sector of the technology industry. Loving the story. Thank-you Griot.
Hi roving griot,
i really hope you continue translating this story as well as ‘investment life’, but I know real life can get in the way. If you don’t continue, that’s fine too because your physical and mental health is more important. Please take care of yourself and hope to hear from you soon. Xxx