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CH313 | GSI
🕑 Added 2025-04-15 02:01:02 +0000 UTCAfter leaving the penthouse, Seok-won took the elevator with his aides and headed straight to the business meeting room at the Plaza Hotel, where today’s meeting was scheduled.
The room, luxuriously decorated with large floor-to-ceiling windows overlooking Central Park and furnished with fine wooden furniture, already had Landon waiting inside, accompanied by the fund’s legal advisor.
After a short wait, the Microsoft representatives arrived, guided in by McGregor, the general manager of the Plaza Hotel.
Seok-won stood up and approached Bill Gates, the tall Microsoft CEO with gold-rimmed glasses, greeting him with a friendly smile.
“Welcome. I apologize for making you come all the way to New York.”
Gates shook his extended hand with a polite smile of his own.
“Not at all. But I hope you managed to take care of that urgent matter you mentioned.”
It was a pointed remark delivered with a smile, but Seok-won responded smoothly, not even blinking an eye.
“Thanks to your understanding, I was able to achieve a good result.”
Gates had tried to open with a light provocation, but Seok-won’s unshakable composure made him click his tongue internally.
‘Young, but definitely no pushover.’
He had a gut feeling this negotiation would be anything but easy.
After exchanging brief greetings, both sides took their seats across from each other at a long wooden table.
Uniformed hotel staff served tea and quietly exited the room along with General Manager McGregor, closing the door behind them.
Seok-won, still calm and composed, was the first to speak.
“Since I know you're busy, why don’t we jump straight to the point?”
“Let’s do that.”
Gates gave a small nod from across the table.
“You’re interested in acquiring Hotmail, I hear.”
Seok-won leaned back in his chair, fingers interlaced, and asked evenly.
“As outlined in our proposal, we’d like to purchase 100% of Hotmail’s shares for 300 million dollars.”
Unlike in Korea, where acquiring a company typically means purchasing the majority stake, in the U.S., buyers are generally expected to acquire the full shareholding.
“We’re open to the idea of selling the company,” Seok-won replied.
“That’s good to hear.”
“But to sign a contract, we’ll need to agree on the price.”
As expected, Gates responded without surprise.
“So I take it our offer didn’t meet your expectations.”
“To be frank—no, it didn’t.”
“Then let’s hear what you believe is a fair price.”
Seok-won responded as though he had been waiting for this very moment.
“We believe it should be at least 500 million dollars.”
While Landon, already briefed in advance, remained calm, the Microsoft representatives couldn’t hide their surprise at the figure.
“Five hundred million dollars…”
“Huh.”
Alvin, the CFO, wore a look of disbelief, while CEO Gates furrowed his brow, visibly displeased.
“That’s quite an unreasonable demand.”
The atmosphere in the meeting room cooled in an instant, but Seok-won remained calm and composed.
“Is that how you see it?”
“We’re talking about a startup that hasn’t even been around for two years. Anyone would say five hundred million dollars is too much.”
Gates responded firmly, his expression stiff.
Seok-won simply shrugged, as if surprised.
“It’s a bit unexpected to hear that from you, CEO Gates—the man who founded Microsoft.”
Gates’s eyebrow twitched slightly at the cryptic response.
“Netscape was also a fledgling venture when it launched, but it was valued at 1.2 billion dollars at the time of its NASDAQ IPO. And now, its market cap has grown far beyond that.”
“…”
“Yahoo’s stock skyrocketed as well. On the very first day of its IPO, the company’s market cap shot up to 848 million dollars.”
Looking directly at Gates, Seok-won continued.
“I believe Hotmail is no less promising than those companies. Isn’t that why Microsoft is trying to acquire it before its value climbs even higher?”
If Gates denied that, he would be admitting poor judgment. But if he agreed, he’d have no choice but to consider raising the offer. It was a classic catch-22.
Realizing he had walked straight into Seok-won’s well-crafted argument, Gates forced an inward, bitter smile.
Still, he couldn’t allow himself to be led by the nose. Steeling himself, he replied calmly.
“I’ll admit Hotmail is a good company, but 500 million dollars is a difficult number to justify.”
“Well, I believe even if we went public right now, the market would validate that valuation.”
At this point, Alvin the CFO could no longer hold back and interjected.
“That’s your personal opinion, not the market’s.”
“Is that so?”
Seok-won curved one side of his lips into a subtle, knowing smile.
Sensing something behind his words, Gates’s face grew tense, while Alvin leaned forward, pressing with a sharp question.
“Are you saying there’s another buyer?”
“I’m afraid I can’t answer that.”
Seok-won replied coolly, deliberately keeping an air of mystery.
Seeing this exchange, Gates and the rest of the Microsoft team couldn’t help but assume the worst—that Netscape had indeed entered the bidding war.
“Would you accept 350 million?”
Biting his lower lip, Gates made a new offer. But Seok-won’s smile vanished completely as he replied firmly.
“I believe I clearly stated the price is 500 million.”
His tone made it obvious he wasn’t going to settle for less.
Gates let out a short, disbelieving laugh.
“At that price, we might be better off investing more into MSN.”
“You might. But while you’re doing that, your competitors will be several steps ahead—and catching up won’t be so easy.”
Shifting in his seat, Seok-won continued smoothly.
“As you know better than anyone, the IT industry evolves at lightning speed. Once someone secures a lead in the market, taking it back requires exponentially more time, effort, and money.”
“…”
“The problem is, even with that kind of investment, there’s no guarantee you’ll get the results you want, is there?”
Seok-won slightly lifted his chin, his eyes brimming with confidence—as if to make it clear who held the upper hand.
“Once the market tips in one direction and a company gains dominance, being second or third doesn’t mean anything anymore. I imagine you know that better than anyone, given what happened with operating systems.”
He was clearly referring to Microsoft’s victory over Apple’s Macintosh in the OS wars, which had allowed them to become a dominant force in the IT industry. Gates had no rebuttal. His lips tightened in discomfort, but he didn’t respond.
He might have thought the price was outrageous, but he knew too well what it meant to lose the market lead once it was taken. That knowledge alone kept him from storming out of the room.
The other Microsoft executives exchanged awkward glances, equally unsettled.
As the silence stretched, Seok-won remained relaxed. He lifted his teacup and took a slow sip of coffee.
Then, sensing that Gates was deep in thought, Seok-won casually dangled a tempting alternative.
“If the acquisition price feels too heavy, there is one way to lighten the burden.”
As expected, Gates looked up, intrigued.
“And what would that be?”
“You could substitute part of the payment with Microsoft stock.”
At that, Gates’s brow furrowed slightly.
“The market’s riding the IT boom, and the stock exchange is red hot. Even if Microsoft raises a few hundred million through a new equity issue for this M&A, it won’t hurt your stock price.”
“…”
“In fact, I’m sure your shareholders would welcome the move. Acquiring a fast-growing company like Hotmail would only boost Microsoft’s valuation.”
It wasn’t a bad proposal. But then Gates recalled that Seok-won was also a major shareholder in Microsoft. Narrowing his eyes, he wondered whether there was more to this offer than met the eye.
Noticing the suspicion, Seok-won let out a small chuckle and added:
“Just to be clear, even if my stake in Microsoft increases through this deal, I have no intention of interfering in company management. I’ll continue to stay on the sidelines as an investor, just as I always have.”
It was true that Seok-won had never meddled in the operations of the companies he invested in. Still, Gates couldn’t help but remain cautious—there were no guarantees about the future.
He stared at Seok-won for a moment as if trying to read deeper, then finally spoke in a more subdued tone.
“This isn’t something we can decide on the spot. How about we take a day to think things through and reconvene tomorrow?”
Seok-won had never expected a decision right then and there anyway, so he nodded without hesitation.
“That sounds good.”
“I’ll be in touch then.”
Gates stood up first.
After exchanging brief farewells, Gates and the Microsoft team exited the meeting room. Once they were gone, Landon turned to Seok-won and asked:
“Do you think Gates will accept your terms?”
At that, Seok-won glanced briefly at the door through which the Microsoft team had just exited, then turned his gaze back to Landon.
“It might be a tough decision for them, but in the end, they’ll have no choice but to buy Hotmail—even if they think the price is high.”
There was unwavering confidence in his voice, and Landon’s eyes lit up.
“Because they’ll want to stop Netscape from getting their hands on it, right?”
Seok-won gave a small nod, a faint smile tugging at his lips.
“Exactly. Someone like Gates knows full well that the internet market will be an even bigger moneymaker than their current monopoly on operating systems. He won’t be able to resist going after it.”
“Turning nine million dollars into two hundred million in just two years… I’m honestly at a loss for words,” Landon said, looking at him with admiration.
But Seok-won responded calmly, showing no sign of elation.
“We haven’t signed the deal yet, so we don’t know how much profit we’ll make.”
“Still, from Microsoft’s perspective, even with some negotiation, they’ll have to buy Hotmail just to keep it out of their competitor’s hands. So you’ll likely make at least fifteen times your original investment, right?”
When Landon spoke with that much certainty, Seok-won didn’t bother denying it.
“And if they go with your proposal to pay part of the acquisition cost in stock, your stake in Microsoft would grow significantly.”
“Exactly. It’s not like their stock is going to drop anytime soon. I’d prefer it that way, but who knows if Gates will go for it.”
Catching the meaning behind his words, Landon gave a small, understanding nod.
“You’re saying he might hesitate because it would increase your voting power.”
Leaning back in his chair, Seok-won responded.
“And it’s not like Microsoft is short on cash. He may not want to dilute his own stake unnecessarily.”
If they chose to raise capital through a stock issuance, Gates’s ownership percentage would decrease unless he also put in more money himself.
“Now that you mention it, that makes sense,” Landon agreed.
Seok-won looked relaxed either way—it was a win-win for him.
Still, somewhere in the back of his mind, he was already thinking about what lay ahead: in just a few years, Microsoft would ride the dot-com boom to surpass a $500 billion market cap, dethroning IBM to become the most valuable company in the world.
He licked his lips unconsciously and murmured to himself:
“It’d be nice if they paid in stock.”
