Hearing this, the executives of Sogou Maps were in great spirits.
Wang Dachuan was even more surprised:
"Chairman, after the acquisition, you won't change Sogou products to Xingyi Technology's name?"
He thought Wang Yi would immediately change Sogou Search to Xingyi Search, Sogou Browser to Xingyi Browser, and Sogou Input Method to Xingyi Input Method...
But to his surprise, Wang Yi decided to keep the Sogou brand!
The reason is simple: Xingyi Technology, as the parent company, like Huawei, is too extensively involved, and Wang Yi does not plan to go public.
However, Xingyi Technology's subsidiaries can be spun off and listed!
For example, the subsidiary Sogou is one of the best choices for listing!
Firstly, Sogou is a household name, and the brand has recognition.
Secondly, Sogou Input Method holds over 79% of the market share, with users and traffic!
Thirdly, Sogou Browser and Search Engine have core technologies and room for development!
If Sogou Browser, Sogou Input Method, and Sogou Search Engine were all emptied and given to Xingyi Technology, Sogou would become an empty shell, and there would be no talk of listing.
But if all these businesses are left with Sogou, allowed to grow bigger and stronger, Sogou could go public in a few years, and with the addition of AI concepts, it's not impossible to build it into a hundred-billion-yuan giant, or even a several-hundred-billion-yuan giant!
There's no other way; search engines burn too much money and are difficult to monetize!
Baidu's search engine market share exceeds 76%, allowing it to make a fortune through bid rankings and advertising.
However, Sogou Search Engine's market share is too low, and its bid ranking and advertising revenue are only a fraction of Baidu's, making it difficult to profit in the short term.
Sogou Maps, which focuses on basic services, is a major money burner; don't even think about profitability.
Unless Sogou Maps grows bigger and stronger in a few years, following the Amap model by launching ride-hailing, group buying, and other ancillary services, only then can it achieve monetization!
Currently, the only promising Sogou Input Method is free, with little room for profit.
If it dared to charge, users would uninstall it in minutes!
But Wang Yi is a businessman, and he acquired Sogou to make money.
If these businesses don't make money, or even won't make money within five years, what then?
Rely entirely on Wang Yi to subsidize them with hundreds of millions each year?
Continuously burn money?
This is unrealistic.
The only solution is to list Sogou!
List in the US, and raise money from Americans!
Raise money from imperial shareholders to develop search engines and AI!
Backed by Xingyi Technology's resources and user base, Sogou has boundless prospects.
Once listed, it will no longer be a major money burner but can become a darling of capital!
At that time, Xingyi Technology will not only be able to rapidly grow bigger and stronger, and see surging profits through Sogou Search Engine, Browser, and other basic services, but also raise money from the stock market!
But if the entire Sogou ecosystem were rebranded as Xingyi Technology, all this would be difficult unless the parent company went public.
The future situation is complex; listing the parent company may not be good.
Once sanctioned, it would collapse across the board.
It is safer to spin off businesses and list subsidiaries like Sogou.
Moreover, rebranding everything as Xingyi would narrow the path.
In the future, users of other brands might think these applications are exclusive to Xingyi phones, and other users would boycott them.
For example, if Sogou Input Method were changed to Xingyi Input Method, many Apple users and Samsung users would probably uninstall it directly!
79% of the market share would drop by a significant portion, which would be not worth the gain.
Xingyi Technology's future development model will be based on subsidiaries and a multi-brand strategy.
The parent company will not be listed, but money-losing yet capital-raising subsidiaries like Sogou will be spun off and listed!
Sogou Input Method, Sogou Browser, and Sogou Search Engine will all continue to be retained!
Wang Yi smiled slightly:
"Don't worry, Xingyi Technology will not cancel Sogou's structure and brand. It is natural for the Sogou brand to operate independently in the future."
"Thank you, Chairman Wang!"
Everyone was excited.
Wang Dachuan was overjoyed.
Sogou was his brainchild; it was not easy to bring it to where it is today.
Perhaps Sogou Search is average, but Sogou Input Method, with over 79% market share, is already very successful.
He would definitely be distressed if it were changed to Xingyi Input Method.
Wang Yi patted Wang Dachuan's shoulder:
"Sogou will continue to exist, grow bigger and stronger, and successfully go public!"
"Thank you, Chairman Wang!"
Wang Dachuan's expression was complex.
They say capital is ruthless, but Wang Yi's willingness to retain the Sogou brand made him feel that his value was recognized and respected by Wang Yi!
Wang Yi shifted the topic:
"However, if Sogou wants to list in the US in the future, it must spin off its maps business!"
"Why?"
Several subordinates looked confused.
Wang Yi's expression became serious, and his tone became somewhat unquestionable:
"The future is the era of high-precision maps. If Sogou Maps wants to monetize, it will definitely need to launch ride-hailing and other services, which involves the privacy and data security of hundreds of millions of users.
If it were to list in the US, these core data would have to be submitted to imperial review. This involves national data security, which would be a huge transgression!"
Everyone's expressions changed, and they immediately sensed the big problem within.
Wang Dachuan nodded:
"Chairman Wang is indeed thoughtful. With a maps business, Sogou cannot list in the US. Some things cannot be touched."
The Vice President suddenly realized:
"If the imperial market is not viable, we can list in Hong Kong; then the risk would be smaller."
Wang Yi waved his hand:
"The capital base of the Hong Kong stock market is much smaller than that of the US stock market. If Sogou wants the highest market capitalization and wants to raise the most money, listing in the US stock market is more suitable!
So, the best solution is to separate the Sogou Maps business and operate it independently. The remaining Sogou Input Method + Sogou Browser + Sogou Search Engine will still be under the Sogou brand, operating as a subsidiary of Xingyi Technology, and listing independently in the US!"
"So that's how it is."
"That's best!"
Everyone nodded in admiration.
They never imagined Wang Yi's mind was so meticulous, having considered all these aspects.
They hadn't thought of it.
Data security is paramount!
Wang Yi could not repeat Didi's past mistake.
Moreover, Wang Yi suspected that the maps + ride-hailing services, involving data security, could only be listed in mainland China or not at all.
After all, Amap was acquired by Alibaba and only launched Amap Ride-Hailing after delisting.
Sogou Maps was also acquired by Tencent, delisted along with Sogou, and finally merged into Tencent Maps.
Wang Yi made a final decision:
"So it's settled. Sogou will operate as a subsidiary, maintaining an independent brand, operating independently, and striving for listing."
"As for Sogou Maps, it will be spun off to become a new subsidiary, given a nicer name, and operated independently!"
Everyone nodded, completely in agreement.
Wang Dachuan sighed:
"The name Sogou Maps is indeed not pleasant! Users have complained about this. Users who didn't understand initially even thought Sogou Maps was for finding dogs!"
"Yes, Sogou Maps needs a nicer name; otherwise, it's really easy to cause unnecessary trouble."
Wang Yi smiled:
"Simply put, Sogou Maps needs to grow bigger and stronger, which will require burning billions of yuan in the next few years. To monetize and profit, it will definitely need to launch services like Sogou Ride-Hailing. If users jokingly say, 'send a fast-running dog'... wouldn't the drivers be embarrassed?"
Just like Kuaigou Ride-Hailing in his previous life, it faced this problem.
Users would directly say, "send a fast dog," and Kuaigou Ride-Hailing drivers would get very angry.
What if ten years later, various industries are in a slump, drivers' stock holdings are trapped, their houses have lost their down payment, they are suffocated by monthly mortgage payments and on the verge of collapse, and then they are called dogs?
The consequences are imaginable...
There could even be bloodshed if they act on impulse!
"The Chairman is right; the name Sogou was indeed chosen hastily,"
several executives said one after another:
"However, Sogou Input Method and Sogou Search are fine. Since Maps has been spun off, it can be changed."
"Yes, although we have an emotional attachment to Sogou Maps, for long-term development, we should still change it to a nicer name."
"Exactly, there's no need to suffer for a name. As Chairman Wang said, traffic monetization for Sogou Ride-Hailing is essential. We must consider the user experience, but also the driver's dignity. If drivers are unwilling to work, then Sogou Ride-Hailing won't succeed!"
"I have no objection to changing the name of Sogou Maps!"
Wang Dachuan also said with a smile.
He understood that one shouldn't be too greedy; Wang Yi had already treated them very well.
If it were BAT, they would definitely completely dismantle Sogou and merge it into other business units, and Sogou would cease to exist.
Sogou's employees would also lose development opportunities, facing continuous layoffs and salary cuts...
For Wang Yi to retain the Sogou brand, allow Sogou to operate independently, and strive for listing, was already very rare.
Changing the name of the spun-off Sogou Maps to a nicer one was also for better future development!
Moreover, the name Sogou Maps indeed affects subsequent development and traffic monetization.
After all, neither users nor drivers want to be treated as "searched dogs"!
Wang Dachuan thought for a moment:
"Chairman, actually, changing Sogou Maps to Xingyi Maps is also fine; it could be directly merged into the parent company!"
Apple Maps and Huawei Maps in his previous life were also named after phone brands.
Xingyi Maps would also not be a big problem.
Wang Yi nodded:
"That works too. Then Sogou Maps will be changed to Xingyi Maps, spun off from Sogou, and the Xingyi Maps business unit will later move into Xingyi Science and Technology Park."
"Good!"
Wang Dachuan nodded:
"I will arrange this as soon as possible, the business division."
The other executives also had no objections.
Currently, Sogou's three-stage rocket refers to "Sogou Input Method" + "Sogou Browser" + "Sogou Search Engine," and does not include Sogou Maps.
To put it bluntly, Sogou Maps is not Sogou's core business, it burns a lot of money, is difficult to profit from, and also involves data security issues.
Spinning it off is perfect!
Wang Yi shifted the topic:
"The maps issue is settled. The next biggest problem is how to make Sogou bigger and stronger and achieve monetization. Only if the revenue looks better can Sogou successfully go public and its market capitalization explode!"
In his previous life, Sogou failed to monetize after listing, its revenue plummeted continuously, and its stock price repeatedly crashed, eventually forcing it to accept Tencent's acquisition, delist, and become a Tencent subsidiary.
Hearing this, Wang Dachuan frowned slightly.
The Vice President, however, spoke without hesitation:
"Chairman, with the three-stage rocket model, Sogou can succeed!"
"Is that so?"
Wang Yi was full of doubts.
What is Sogou's three-stage rocket model?
First-stage rocket: Sogou Input Method!
With accurate Pinyin input, rich vocabulary association, and a DIY input interface, Sogou Input Method captured 79% of the market share!
Undoubtedly a leading product with enormous traffic.
Second-stage rocket: Leveraging the traffic from Sogou Input Method, through the web-side, promote the PC-side Sogou Browser to increase the number of Sogou Browser users!
Third-stage rocket: Sogou Browser has a built-in Sogou Search Engine!
The increase in Sogou Browser users simultaneously drives the growth of Sogou Search Engine's user base and market share!
Through the three-stage rocket model, Sogou Search Engine's user base surged, ultimately achieving traffic monetization and a perfect closed loop, just like Baidu Search Engine!
It had a strikingly similar effect to how Wang Yi previously leveraged Meiyou to promote the pure yet alluring style.
This three-stage rocket business model was invented by the genius Wang Dachuan, and then thoroughly learned by 360's Zhou.
Indeed, 360's rapid rise and its ability to compete with BAT were also due to the three-stage rocket model.
First-stage rocket: 360's free antivirus directly overthrew paid antivirus, gaining a large user base. Traffic secured!
Second-stage rocket: Brand upgrade, transforming a simple antivirus tool into a cybersecurity platform, and subsequently launching various segmented tools, firmly locking traffic in 360's hands.
Third-stage rocket: Traffic monetization, achieved through platforms like 360 Browser, 360 App Assistant, and 360 Games!
The three-stage rocket model was exceptionally effective in the PC era.
But on the mobile end, Sogou's three-stage rocket model was not as effective.
Simply put, in the PC era, input methods and browsers had a progressive relationship.
Sogou Input Method could directly open Sogou Browser and Sogou Search through web page redirection, thereby increasing browser and search engine users!
But on the mobile end, input methods and browsers are parallel and independent apps.
Sogou Input Method cannot directly open Sogou Browser; one must download the app first!
Precisely because the three-stage rocket model was no longer viable on the mobile end, Sogou Browser and Sogou Search Engine in his previous life both lost momentum and eventually had to sell out to Tencent.
Wang Yi knew this, and Wang Dachuan also knew this.
Wang Dachuan shook his head:
"The old three-stage rocket model worked on the PC end, but it's not viable on the mobile end. However, with Chairman Wang's appearance, we can create a brand new mobile-end three-stage rocket model!"
Wang Dachuan thought clearly: on the mobile end, Sogou Input Method couldn't drive growth, but Xingyi phones could!
In the future, if Xingyi phones came with Sogou Input Method, Sogou Browser, and Sogou Search Engine built-in, wouldn't that work?
In fact, Sogou's true decision-maker was not just Zhang Yang, but also Wang Dachuan.
If Wang Dachuan did not agree to sell Sogou, Zhang Yang would not have been able to force it.
Earlier, 360's Zhou had approached Sohu, wanting to acquire Sogou, and then integrate 360 + Sogou to take on Baidu!
But unfortunately, Wang Dachuan felt that Zhou was too domineering and would interfere with Sogou's development, so he rejected the offer.
Ultimately, Zhou was kicked out, and Sogou introduced Alibaba capital.
However, after Alibaba entered the game, it didn't have much effect either.
The three-stage rocket model became unviable on the mobile end, falling into a predicament.
At this point, Wang Yi entered the scene and made an acquisition offer.
Originally, Zhang Yang was worried that Wang Dachuan would refuse, and he had already planned how to persuade Wang Dachuan, as Sohu really needed money.
But to his surprise, Wang Dachuan didn't refute at all; instead, he directly agreed and welcomed Wang Yi!
With such a forthright attitude, Zhang Yang even suspected that Wang Dachuan, who had been with him for over a decade, had long been bought off by Wang Yi!
He even sent people to investigate Wang Dachuan!
In reality, Wang Dachuan had long discovered that Xingyi phones, with their terrifying sales volume, had boundless prospects and could perfectly become the new three-stage rocket, driving the rapid growth of Sogou Browser and Sogou Search Engine, ultimately achieving traffic monetization!
Furthermore, Xingyi Technology's strong capabilities could completely break Sogou's current predicament and bring Sogou entirely new development!
Only then was Dachuan willing to sell Sogou to Wang Yi!
Of course, another gamble was that Wang Dachuan believed Wang Yi was a discerning person who recognized talent and would not treat him badly!
With the new mobile-end three-stage rocket, Sogou's growth into a bigger and stronger entity would be no problem.
"That's right, Xingyi phones + Sogou Browser + Sogou Search Engine is the new mobile-end three-stage rocket!"
Wang Yi smiled:
"In the future, the mobile end will be driven by Xingyi phones, but the search service must be done well. If Sogou Search doesn't perform well, even with Xingyi phones having Sogou Search built-in, users won't use it, and then it's over!"
"Chairman, rest assured, you've invested 200 million yuan in us, and we have Xingyi phones' built-in resources. We will definitely make Sogou Search bigger and stronger and catch up with Baidu!"
Wang Dachuan said, patting his chest in assurance.
Now that the mobile-end three-stage rocket is formed, and with funds and resources available, if Sogou Search still cannot grow bigger, then they are useless!
"Very good, I believe in you all! In the future, you core executives will not only enjoy higher salaries but also phantom stock dividends; you can all enjoy the fruits of Sogou's growth!"
"Thank you, Chairman Wang!"
Everyone was excited.
With Xingyi Technology as their super financier, Sogou ushered in a new era!
Not only did they have money, but also resources.
And with phantom stock dividends, they would, of course, go all out.
Similarly, with Sogou, Xingyi phones' browser, input method, and maps have all developed from scratch to a first-class level!
It can be said that these 1.65 billion yuan were spent for super value!
Extremely worthwhile!
Subsequently, several executives left one after another, each to their own duties.
Wang Yi, however, kept Wang Dachuan behind:
"Dachuan, you are Sogou's founder, and I'm very optimistic about you. So I'm making an exception for you!"
Saying this, Wang Yi took out the share acquisition agreement for Wang Dachuan:
"I'm giving you two choices. First, I will continue to acquire your 10 million Sogou Class A shares, and you will receive 82.5 million yuan. You will continue to be Sogou's CEO, and I will give you 10 million phantom shares, with annual dividends."
"Second, this acquisition will be canceled, and your 10 million Sogou shares will remain in your hands. You will hold 5% of the shares, becoming the second largest shareholder."
"Chairman Wang... I..."
Wang Dachuan was extremely excited, full of emotions, never imagining that Wang Yi would give him such preferential treatment.
Either option was excellent!
The first option meant no longer owning 5% of the shares, cashing out 82.5 million yuan, but still having 5% phantom stock dividends, which was still very comfortable!
The second option was to retain his 5% actual shares, making him the second largest shareholder!
Aside from Wang Yi, the sole shareholder!
This kind of treatment was truly excellent.
If it were BAT, this would be impossible.
There was no other way; Wang Dachuan was Sogou's founder, talented and capable.
If Wang Yi didn't give him shares or phantom shares, and Wang Dachuan resigned with 82.5 million yuan to start his own business, wouldn't that be troublesome?
Where else could they find a Wang Dachuan who was familiar with Sogou and could lead Sogou to grow bigger and stronger?
Moreover, once Wang Dachuan left, other core executives at Sogou would likely follow him.
Conversely, as long as Wang Dachuan was there, other Sogou executives wouldn't leave.
Wang Yi would only need to make demands, provide funding and development direction, and Wang Dachuan could handle the rest with his team.
Such talent was worth giving some phantom shares, or even actual shares.
Wang Dachuan was deeply moved:
"Chairman, thank you. I choose option one!"
"???"
Wang Yi was a bit surprised.
I'm giving you shares, and you still choose option one?
Wang Dachuan smiled:
"Chairman, Sogou is currently valued at 1.65 billion yuan, and I have 5% of the shares. For Sogou to develop in the future, you will need to continuously make additional investments, and even raise funds.
Even if I retain 5% of the shares, my holdings will be continuously diluted as investments increase. Rather than that, it would be better to sell the shares, cash out 82.5 million yuan, and still get 10 million phantom shares!"
"Are you sure?"
Wang Yi's expression was somewhat complex:
"If you want actual shares, it's completely possible!"
Wang Dachuan sighed, thinking to himself:
'Chairman Wang, you've already repurchased 100% of Sogou, and now you're willing to make an exception for me to retain shares, valuing me so highly. But I cannot be insensible!'
He immediately said:
"Chairman Wang, I'm sure; phantom shares are enough!"
"What are you talking about?!"
Wang Yi directly tore up the acquisition agreement:
"Your phantom shares are gone, your money is gone. Keep your 10 million shares! With only one shareholder, Sogou has no chance of listing!"
Wang Dachuan was excited:
"Thank you, Chairman Wang, thank you!"
With Wang Yi's investment, Sogou has unlimited potential.
With actual shares, who would want phantom shares?
Even if they are diluted to only 1% a few years later, the stock price would also be higher, naturally making them more valuable!
It's all relative.
Thus, Sogou's equity structure was settled: Wang Yi, the majority shareholder, holds 95% of the shares, and Wang Dachuan, the second largest shareholder, holds 5%.
Wang Yi decided to give Wang Dachuan actual shares, firstly because this guy is a talent, and it would be unreasonable not to give him actual shares.
Secondly, if Sogou wanted to go public in the future, having only Wang Yi as a shareholder would be futile; there needed to be at least two shareholders.
Thirdly, with 82.5 million yuan, Wang Dachuan could easily indulge in sensual pleasures, which would not be conducive to his struggle!
It has been proven that only when entrepreneurs are penniless can they stimulate their greatest potential and ability!
Conversely, once an entrepreneur gets rich, they will most likely get carried away and become useless!
So it was better to cancel the acquisition, let Wang Dachuan suffer for a few more years, be a high-end workhorse for a few more years, until Sogou goes public and Wang Yi makes a lot of money!
For this arrangement, Wang Dachuan was extremely grateful:
"Chairman Wang, don't worry, I will definitely do a good job with Sogou; please rest assured!"
Wang Yi nodded:
"I believe in you. Next, let's discuss how Sogou Search Engine and Sogou Browser can quickly seize market share!"
Currently, Sogou's development is very unbalanced.
Sogou Input Method holds 79% of the market share, ranking number one nationwide.
However, Sogou Browser only has 9% market share, ranking third nationwide.
This is far lower than IE Browser's over 50% market share and 360 Browser's 26% market share.
As for Sogou Search Engine, it only has 2.4%, also third, far below Baidu's 76%!
"Chairman, actually, Baidu blocking Xingyi Video these past two days has helped us a lot! Baidu Search Engine cannot find Xingyi Video, so users can only choose Sogou and Tencent Soso, especially Sogou, which is used the most."
Wang Dachuan said with a smile:
"Precisely because of this, our Sogou Search Engine's market share has rapidly increased from the previous 2.4% to 3.9%! Sogou Browser has also increased from 9% to 12%!"
Wang Yi nodded:
"There's an increase, but it's still far from enough. Next, I will have Xingyi Video cooperate with Sogou for promotion, deeply integrate, and increase market share!"
"Good, I have also added Xingyi Video and Xingyi Music entry points on the Sogou Browser homepage!"
This kind of joint promotion can completely achieve the effect of 1+1 being greater than 2.
"Also, Google's complete withdrawal is a big opportunity!"
Wang Yi shifted the topic:
"Next, I will use Xingyi Technology's resources, Meiyou's traffic, and 'Defend the Pomelo's' traffic to promote Sogou Search Browser and Sogou Search Engine!"
Currently, Meiyou app users have exceeded 100 million, making it a traffic platform!
Of course, "Defend the Pomelo" has even more users, over 150 million!
"No, Dachuan, you directly arrange a team to interface with Meiyou and integrate Sogou Search Engine into the Meiyou app. This way, over 100 million Meiyou users will gradually become Sogou Search users!"
"!!!"
Wang Dachuan's eyes lit up:
"Chairman Wang, what a great idea! Meiyou users are predominantly female, with high spending power, making them one of the most valuable groups. Even if only one-third of these over 100 million users successfully convert, Sogou Search Engine could increase by six or seven percentage points, potentially breaking through 10% market share!"
Currently, there are only 500 million domestic netizens!
"Yes, do it as soon as possible!"
Wang Yi said:
"For 'Defend the Pomelo,' I will have the game team create several Sogou-themed images for promotion. Then we'll launch an event where users download Sogou Browser, search for 'Defend the Pomelo' to receive exclusive gift packages!"
"Good! Chairman Wang, this way, the number of users for both Sogou Browser and Sogou Search Engine will rapidly increase!"
"And the Baidu matter can also be hyped up again!"
"Good!"
Wang Dachuan was excited, never expecting Wang Yi to be so skilled at integrating resources!
But what he didn't know was, this was just the beginning, just small-scale action!
This method, attracting traffic and increasing users, is possible, but overthrowing Baidu is unrealistic.
Sogou Search Engine's future development direction will naturally be to integrate Xiao i Robot + AI algorithms and focus on AI search!
But this matter cannot be too hasty.
After all, the Xiao i Robot team is busy adapting to Xingyi Xphone 1, preparing to take on the iPhone 4s next month.
Currently, there simply isn't enough energy to interface with Sogou.
For now, Sogou should first use the 200 million yuan approved by Wang Yi to expand its database and catch up with Baidu.
Once the gap in the database narrows, they will then launch features like image to text, image to Word, image to PDF, voice search, AI search, and image search, decisively defeating Baidu!
If the database gap is not resolved, no matter how many features Sogou launches, it won't be very meaningful; they will only be copied by Baidu, benefiting Baidu.
After all, the most essential aspect of a search engine is a comprehensive database and accurate search results!
However, Wang Yi can assign these functions to Wang Dachuan, who can arrange for reliable confidants to develop them secretly, and then launch them at an opportune time!
Sogou has over a thousand employees, 75% of whom are developers!
This proportion is considered very high in the internet industry.
Therefore, Sogou also ranks among the top in the number of patents.
That night, a news story trended on hot search:
[Baidu Blocks Xingyi Video, Xingyi Technology Acquires Sogou for 1.65 Billion Yuan to Fight to the End!]
For a time, the whole internet was abuzz, but Li Yan suffered from insomnia once again!
(End of this chapter)