This time, the angel round financing for Wanlong Group Buying was only a preliminary signing of a letter of intent.
In a few days, Ji Zhe and Chu Hai will each bring their company’s professional teams over to formally sign the agreement.
The initial agreement is that this round of financing will release 20% equity, with Ji Zhe’s and Chu Hai’s companies each holding 10%. Based on the current scale of Wanlong Group Buying, they valued it at 40 million yuan.
Objectively speaking, this valuation is already on the high side—and not just a little bit.
After all, Wanlong Group Buying is just getting started; it can almost be said that there’s practically nothing to show for it, yet such a high valuation was given.
Usually, a business needs to expand across several cities or even a whole province and accumulate a certain amount of operational data before such a valuation would be reasonable.
Later, as the business scale continues to grow, multiple rounds of financing like Series A, B, and C will follow, with the company’s overall valuation steadily climbing.
Getting such a high valuation in the angel round was entirely because Ji Zhe and Chu Hai not only didn’t push for a lower price but actively raised it—a gesture of goodwill, so to speak.
Of course, they didn’t do this without conditions.
The first condition was to reserve 10% of the equity as an option pool.
This would change the equity structure to: Wanlong holding 70%, 10% reserved for options, Qixing Capital holding 10%, and AEG Dragon National District Capital holding 10%.
The second condition was that they would have the right of first refusal to follow-on investment in the upcoming Series A round.
This second condition was the real protective moat they wanted.
They paid a high price and took on great risk in the angel round, so in Series A, they must have the priority to follow up on investments to ensure their shares won’t be easily diluted by much larger capital later on.
This essentially locks in the size of the future pie they’ll be entitled to.
However, Wanlong also put forward conditions.
First, Ji Zhe and Chu Hai’s companies cannot invest in any future competitors of Wanlong Group Buying. Second, the ownership, issuance conditions, repurchase mechanisms of the 10% option pool, as well as the specific exercise terms of the Series A priority rights, must all be led and drafted by Wanlong.
Third, a unanimous action agreement must be signed.
Fourth, the other parties need to provide support to Wanlong Group Buying in certain specific resources.
This includes helping to recruit talent, such as key technical members from the previous “Some Group” and so on.
The idea is to drain the important backbone talents from potential future competitors, thereby reducing pressure when competition arises.
Moreover, with Qixing and AEG’s investment institutions backing the recruitment, it’s definitely more effective than Wanlong trying on its own.
After all, as long as they can get people to come... no, to Bright Pearl City for interviews, whether or not the deal closes later is none of their concern.
Currently, both sides have basically reached consensus on these core terms.
...
After seeing Ji Zhe and Chu Hai off, Liu Yutong gave Yu Xin and Xiao Bin a separate briefing.
“You don’t need to celebrate too early. The angel round is just the beginning. You need to spend this capital quickly. The ground-level promotion should be fully rolled out wherever necessary, and the technical architecture should continue to be deeply optimized.”
“In two months’ time, you need to ensure that the group-buying business covers our entire province and expands into several neighboring economically developed cities. Although we are currently pioneers in the group-buying sector, we must move faster than any potential imitators!”
“When the funds run out, immediately initiate the Series A financing round. How many times the valuation can multiply depends entirely on the results you deliver in these two months!”
Yu Xin and Xiao Bin exchanged a glance, both seeing the spark of determination ignited in each other’s eyes.
“Understood, Sister Yutong!”
“Understood, Miss!”
“We definitely won’t let you down!” they said in unison.
Afterwards,
Liu Yutong instructed Yun Cheng to summon all other core executives within the group to her office.
Yun Cheng, Ma Da, Yu Xin, Li Xiaohui, Yang Xin, Zhao Tianyi... these senior executives, all key members of Wanlonghui, were naturally included.
Besides them, other external senior managers based in Bright Pearl City, such as Yu Yinghui, head of logistics, and Yao Qianshan, the current deputy general manager of the supermarket, were also notified to attend.
There were more than twenty people in total.
Fortunately, Liu Yutong’s office was spacious enough that even with over twenty executives and managers from various projects gathered inside, it didn’t feel cramped.
Once everyone had arrived, Liu Yutong’s eyes burned with intensity as she slowly began, “The new year has begun. Wanlonghui now operates supermarkets, restaurants, group-buying, internet cafes, and more. This means we have more cards in hand than ever before.”
“Today, the first shot of the new year has been fired. The group-buying project has successfully signed a letter of intent for angel round financing with an external investment institution — a very promising sign. Now, it’s time for us to completely broaden our horizons!”
Liu Yutong picked up a pen and wrote two bold characters on the whiteboard: [Group].
“From today onward, Wanlonghui officially begins its restructuring and will be renamed — Wanlonghui Group!”
