Chapter 753: Interests come first

Seeing Robert Swanson's neck veins bulge, with a tendency to angrily end the conversation, Xia Yu immediately said, 'In fact, you can listen to my conditions. For the 25% equity you hold, our company is willing to pay a high premium and contribute 35 million US dollars!'

'After three rounds of investment, you have only contributed a total of more than 300,000 US dollars, and you have reaped a profit of more than 100 times!'

Upon hearing this, Robert Swanson was stunned.

Harry Morrison's pupils also contracted, and his inner resistance instantly dissolved.

Buying 25% of the equity for 35 million US dollars was equivalent to valuing Genetech at 140 million US dollars.

Currently, Genetech's total assets were only about 2.5 million US dollars, and its annual net profit was negative, so this valuation was already very high.

Although the general valuation outside the company was between 100 million and 150 million US dollars, they knew in their hearts that this valuation was the price after going public.

Genentech was already in the process of going public, and they had made an internal estimate and also sought the advice of investment banks. The investment banks were willing to offer a very low issue price, based on a floor market value of 100 million US dollars.

At this point, Xia Yu's valuation was much higher than that of the investment bank, which was equivalent to a 40% increase in the stock price after listing.

Moreover, they didn't have to wait another six months, nor did they have to lock up their shares for a year. They could get the money early to invest in the companies they wanted to invest in, without taking on a lot of risk!

Although there were still six months to go, perhaps Genentech would perform even better and substantially raise the issue price, but that was not absolute.

Because Professor Herbert Boyer is still engaged in research and development, Genentech has never launched a product on the market. For scientific research, there are too many unknowns, and it is only natural that there will be missed deadlines.

If Professor Herbert Boyer does not produce results on time, then the patents that have been developed so far are not enough to support Genentech's extremely high valuation.

The reason for Genentech's terrifying valuation is precisely the capital market's high expectations for Professor Herb Boyer. Once these expectations are dashed, it will be the beginning of the bubble bursting!

As for whether they have confidence in Professor Herb Boyer, in the face of outsiders, people like Harry Morrison will definitely say with conviction that they do, but in fact, they themselves are not sure.

The probability of producing results from experiments and scientific research is too small, and it requires countless failures.

Throughout the ages, many scientific research results have appeared by accident, and often they have been sought after but not found.

Seeing the three men's hesitant expressions, Xia Yu felt reassured and continued, 'Mr Morrison, Mr Swanson, we are here to negotiate with you in good faith and with a win-win attitude. I can tell you frankly that we at Polaris Capital have the financial strength to take on the risks of Genentech and the patience to wait.'

'And you, Coller Perkins, need to give investors an answer. Their patience is not necessarily very good. For Coller Perkins, it is best to specialise in angel and Series A rounds of venture capital. Just like now, if you can invest in one and get a hundred times the profit, you will be very happy.'

'And we? We invest large sums of money, and we just earn hard-earned money. We would be very happy if we could double it.'

'You might want to think about it. We'll go back first and come back in the afternoon.'

After saying this, Xia Yu lifted his teacup and took a sip, then got up and led the way out.

Harry Morrison sent Xia Yu and the others out the door absentmindedly, then returned to his office, closed the door, and said in a grave voice, 'You all heard it just now. What do you think?'

After saying this, Harry Morrison directed his gaze at Robert Swanson.

As for the other person, Colin Hicks also subconsciously directed his gaze at Robert Swanson.

In the Coller Perkins company, all three were central figures, with Harry Morrison and Colin Hicks being the founders.

Robert Swanson, on the other hand, had risen step by step from junior partner to his current position entirely on his own, and it was the discovery of Genetech that had carried him to where he was today.

Although Harry Morrison had the direct right to sell the shares, he wanted to give Robert Swanson a certain amount of respect for the sake of the company's stability and unity.

Harry Morrison, as CEO, had something to say, but Colin Hicks, his long-time partner, naturally knew his friend's attitude and took the initiative to step forward and state, 'Over the past four years, we have invested a total of 3.67 million US dollars in Genetech. If we go with the 35 million US dollar price offered by Polaris Capital, we will make a profit of more than 94 times.'

'And this is only their first offer. As long as we continue to negotiate, the price will be even higher, at least more than 40 million US dollars!'

'And our company's current total capital is 47.2 million US dollars!'

Having said this, Colin Hicks said no more, and sipped his coffee slowly.

Robert Swanson's face was constantly changing, and his mind was fiercely conflicted.

He knew that Colin Hicks had been talking to him!

After a long while, he said hoarsely, 'Professor Herb Boyer trusts us, and if we sell our shares to Polaris Capital, he may not be able to accept it!'

'And I have great confidence in Genentech. I believe that if we wait another six months, Professor Herb Boyer's research and development will bear fruit, and Genentech's market value will not be low!'

After saying this, Robert Swanson looked straight at Harry Morrison.

Harry Morrison sighed, looked directly at Robert Swanson, and said frankly, 'Robert, to be honest, just now Mr. Xia's reasons and price convinced me.'

'He said something that woke me up. We are only a small player in the venture capital industry, and now specialising in angel rounds and Series A rounds is the best for our company. When we first set up the company, Colin and I made the same decision, except that later you discovered Genentech, which far exceeded our expectations. We followed through to Series B, but our strength was not enough to continue investing in Series C.'

'Fortunately, Genentech grew fast enough to skip the financing stage and go public directly, otherwise we would have faced a choice.'

'But now, suddenly, another choice has appeared, and I think we must face it. This is not just a matter of investing in a company, but also involves the strategic positioning of the entire company, which is the most fundamental thing!'

After such a long speech, Harry Morrison paused for a moment, took a sip of coffee, and then said with a sigh, 'Robert, I know you are on good terms with Professor Herb Boyle, but he is a man obsessed with scientific research. I believe that if you explain it to him, he will definitely understand us.'

'Even if we don't withdraw now, we will have to choose to withdraw after the company goes public. This is an unchangeable result, the difference is just the time.

After Harry Morrison finished speaking, the entire office fell silent, and no one spoke for a long time.

After a long time, Robert Swanson finally figured it out. He let out a long sigh, nodded, and said, 'Harry, you're right, withdrawing now will indeed be more beneficial to the company. I will follow your decision and I will try my best to explain to Professor Herb Boyle.'

Harry Morrison and Colin Hicks both smiled when they heard Robert Swanson say that.

Harry Morrison smiled and said, 'Robert, thank you for understanding. After the deal is completed, you will receive a generous bonus.'

Robert Swanson forced a smile and said, "Thank you!'

Colin Hicks clapped his hands to attract the attention of the two men and said, "Well guys, congratulations on reaching an internal agreement.'

'Next, we should discuss how to negotiate. Don't forget that Polaris Capital will be back this afternoon. That young Asian guy is no pushover. He left the three of us speechless.'

Harry Morrison smiled confidently and said, 'Colin, don't belittle ourselves. Just now, it was because we weren't prepared. This afternoon, the initiative will be on our side.'

Colin Hicks smiled and said, 'Haha, you're right, but we still need to prepare.'

'Strive to sell the equity at a higher price!'

Robert Swanson said viciously, 'This is a must. It must be sold at a good price. It contains several years of my hard work!'

'Hahaha...'