Huang He hadn't expected that a trip to DW, encountering a taxi driver, and then eating some barbecue, would lead to him spending 1 million RMB to buy a mobile phone factory named Tianxing.
Although this mobile phone factory, including its boss Liu Nian, had less than 12 people in total and produced fewer than 20 phones a day, Huang He still spent 1 million to acquire 70% of its shares, becoming its actual controller.
To others, this might seem an incomprehensible act. However, in Huang He's view, he had once again grasped the trend of the times!
Shanzhai phones, a phenomenon that had almost disappeared from the memories of many born after 2000, were deeply etched in the minds of those born in the 80s and 90s.
Back then, mobile phones were incredibly expensive. Even the cheapest Nokia phone, capable only of making calls, cost 2,000 RMB in 2001. This was simply unaffordable for the average person.
Although PHS later emerged, its limitations were significant, and its signal was poor, rendering it incapable of replacing mobile phones. It was ultimately the shanzhai phones that truly brought mobile phone prices down below the thousand-yuan mark.
The exact origin of shanzhai phones is unrecorded. However, by 2003, they began appearing in Huaqiangbei. Subsequently, vendors nationwide flocked there to procure them. A shanzhai phone bought for 400 yuan could be sold for 800 yuan in local electronics markets, while branded phones with similar functions were unimaginable for less than two to three thousand yuan.
As a result, shanzhai phones naturally swept the entire mobile phone market.
Currently, it was precisely the nascent stage of shanzhai phones. This Liu Nian seemed to be the very first person in China to pioneer shanzhai phones.
Yesterday, upon learning that the taxi driver possessed shanzhai phone supply sources, Huang He, disregarding his fatigue, immediately arranged to meet Liu Nian that very night. The two found a late-night eatery, where they ate and talked.
Liu Nian's story was rather unfortunate.
Liu Nian was once a university student with a bright future, attending Xi'an University of Posts and Telecommunications. However, in his freshman year, he was caught by the public security bureau for earning pocket money in the black market by manufacturing a listening device and was imprisoned for a year. After his release, he naturally had nothing left.
Fortunately, Liu Nian possessed strong capabilities. He returned to Shenzhen, coincidentally as his family's home was undergoing demolition and compensation was provided in the form of a building. Liu Nian sold his building, exchanged it for 500,000 yuan in cash, and planned to venture into manufacturing.
Initially, he intended to develop positioning devices. He succeeded in creating one but failed to find an application environment for it.
Later, he ventured into MP3 players. However, the MP3 market was already fiercely competitive. While Liu Nian's products were good, he couldn't control costs, giving him no price advantage. Coupled with a lack of marketing expertise, he suffered another bitter defeat.
Finally, Liu Nian decided to take a gamble and directly manufacture mobile phones. He believed the profit margins in the mobile phone industry were substantial. Even if his cost control wasn't perfect, he could still make a profit. Furthermore, there were no domestic mobile phone brands, so he assumed a market would exist without requiring marketing. Thus, he invested his last savings and, indeed, managed to produce a phone.
However, this phone still couldn't sell. Even if Liu Nian produced only 10 phones a day, he was losing thousands of yuan daily. His stall in Huaqiangbei also cost over ten thousand yuan per month. Had it not been for Huang He's appearance, he would have been unable to hold on.
After hearing Liu Nian's story, Huang He did not mock him like others might have. Instead, he keenly perceived that Liu Nian was a super genius. Although he had failed consecutively three times, his failures were all in business operations. His research and development never faltered. Relying solely on some electronic equipment at home and his own abilities, he had managed to produce three different products: an electronic positioning device, an MP3 player, and finally, a mobile phone. This was incredibly impressive.
Especially the mobile phone, could one person truly accomplish this?
It was only through Liu Nian's explanation that Huang He finally understood. Three months prior, MediaTek from Taiwan had launched its MTK mobile phone chip and a corresponding open platform.
This MTK chip was equivalent to a mobile phone's NDA. All that was needed was to purchase the corresponding electronic equipment that supported the MTK chip, along with some mobile phone and electronics manufacturing and design capabilities, to produce a brand-new mobile phone.
Since MediaTek already had numerous suppliers, the relevant equipment supporting the MTK platform was readily available in the market, posing no significant difficulty. In Liu Nian's words, if one learned from him for a year, he guaranteed to train an engineer capable of independently manufacturing a new mobile phone.
This was also the reason for the proliferation of shanzhai phones in China in the future. By leveraging the MTK open platform, the difficulty of manufacturing mobile phones was greatly reduced, transforming the process from overall design and production into a building-block like assembly operation.
What was once proprietary technology of large corporations became a business accessible even to guerilla operations.
However, Liu Nian was being somewhat modest. Even with the increased ease of manufacturing shanzhai phones, that would only become common after 2004. By then, Guangdong alone could boast over fifty thousand electronics factories involved in mobile phone production.
But at the present time, the options were limited. Liu Nian had manually built many of the electronic devices himself to ultimately create the phone. This capability was undeniably formidable, prompting Huang He to immediately offer 1 million yuan for a 70% stake in Tianxing.
The two continued their discussions until past 1 AM last night. Therefore, early this morning, Huang He brought Leng Zhimeng to continue discussing the details with Liu Nian and his team.
They ended up staying for a full week.
Finally, both parties finalized the agreement. Jiangnan Group stepped forward and acquired 70% of Tianxing Mobile's shares from Liu Nian for 1 million yuan. Simultaneously, Jiangnan Group injected 700,000 yuan into Tianxing Mobile, with Liu Nian contributing another 300,000 yuan, providing Tianxing Mobile with the necessary cash flow to continue operations.
Furthermore, Liu Nian was contractually obligated to remain with the company for ten years without Huang He's permission.
Concurrently, Liu Nian would be fully responsible for the company's production and research and development. However, the company's marketing, sales, and other aspects would be handled entirely by Jiangnan Group, with no interference from Liu Nian.
This contract was quickly concluded. The subsequent legal procedural changes proved to be more troublesome. For these matters, Leng Zhiruo brought the company's official seals and other documents to Shenzhen to handle various procedures.
However, Leng Zhiruo soon discovered an issue.
"Brother-in-law, our company is Jiangnan Leather Factory, not Jiangnan Group. You've signed the contract incorrectly!" Leng Zhiruo stated.
"Oh, then we'll just apply to establish a Jiangnan Group Holdings Co., Ltd.!" Huang He said with a smile. A mere leather factory could not satisfy Huang He's ambitions.