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CH155 | GSI
🕑 Added 2025-02-22 03:30:03 +0000 UTCHotmail, launched in 1996, was the world’s first web-based email service.
It was a groundbreaking innovation that shifted email usage from the server-client model to a web browser-centric experience.
'Wait… wasn’t Hotmail part of Microsoft’s Windows email services?'
Even with his knowledge from the future, Seok-won didn’t remember every detail of IT history, so he couldn’t help but feel puzzled.
Meanwhile, Roy and his friends sat there anxiously, like students waiting for their test results.
Seok-won’s mind raced.
'Maybe Microsoft acquired Hotmail and integrated it into Windows later.'
Unlike in Korea, buying out companies to fill market gaps was common practice in the U.S., making this scenario entirely possible.
If his guess was correct, then this might not be as big as Netscape, but it could still be a lucrative opportunity.
'First Tom Harper, and now Roy… this guy’s got incredible luck.'
Watching Roy fidget nervously, clueless about the thoughts running through his head, Seok-won felt a quiet sense of satisfaction.
Roy was practically bringing gold to his feet without even realizing it—how could he not find that endearing?
Of course, he kept his thoughts to himself. Instead, he calmly picked up his iced coffee, took a sip, and spoke in an even tone.
"So, this new business of yours… it’s an email service?"
At Seok-won’s question, Roy leaned forward, eager to explain his business idea in detail.
"Yeah. Instead of the usual client-based system, it’s an email service built entirely on web browsers."
Seok-won gave a small nod, signaling that he was listening.
Seeing the spark of interest in his expression, Roy became even more enthusiastic as he continued speaking.
"If you want to use personal email at the company, you need to connect to an external server using a modem. But because of the firewall installed for security, that's impossible."
"That's true."
"So, people usually exchange necessary materials or share opinions using paper documents or floppy disks, but that's way too inconvenient."
Seok-won, who felt this inconvenience more than anyone else, nodded in agreement.
In his previous life, he could have easily handled such tasks using a messenger or email. But now, he had to either call people over in person or read through physical documents, which was a hassle.
"But with a web browser, you can easily access any website in the world. So, if we use a web browser for email, wouldn't that solve all these problems?"
It was a simple shift in perspective, yet an incredibly revolutionary idea.
And no one knew better than Seok-won that this idea would eventually lead to massive success and play a crucial role in the expansion of the internet.
A sudden thought crossed his mind, and he turned to Roy.
"Did you come up with this after seeing Netscape?"
"Honestly, you're half right."
Roy shrugged and glanced at Frank and Banerjee, who were sitting beside him.
"These two used to work together at Apple."
"They worked at Apple?"
Seok-won looked slightly surprised, and Banerjee answered somewhat sheepishly.
"Yeah, but I left two years ago. I already quit the company I moved to after that as well."
Even if Frank and Banerjee knew each other from before, Seok-won was curious about how Roy was connected to them and how they ended up starting a company together.
"Didn't you say you worked at a different company?"
"Yeah, that's right. Actually, the three of us became friends while playing a game called Primal Rage."
Primal Rage was a fighting game developed and released for arcades.
It seemed like an odd way to form a business partnership, but considering Roy’s sociable nature, it wasn’t all that surprising.
‘Now that I think about it, this guy even dragged me into a Street Fighter tournament once…’
He recalled how Roy had pushed him into competing, and before he knew it, he had ended up winning the whole thing.
"Anyway, those two needed to send and receive emails not just at work but sometimes from home as well, but because of the issues we talked about earlier, it wasn’t easy. They used to vent about it to me, and then one day, Tom sent me a beta version of Netscape. The moment I tried it, I thought—this is it."
Hearing Roy’s explanation, Seok-won now understood why he had said "half right."
"So… what do you think?"
Roy glanced at Seok-won’s expression and asked cautiously.
Frank and Banerjee also looked at Seok-won with tense eyes.
"I think it's a good idea."
Seok-won leaned back against the sofa and smiled slightly.
"If I could use email that way, it would be incredibly convenient for me too."
At his words, Roy and his friends' faces lit up with excitement.
However, as soon as they heard what Seok-won said next, their expressions quickly stiffened again, as if their excitement had never been there.
"But there's one critical problem."
"And what's that?"
Seok-won clasped his hands together and spoke seriously.
"If it gets developed, it would definitely be a useful service. But how are you going to make money from it?"
"……."
"As the number of users increases, the costs of building and maintaining servers will skyrocket. Even if you worry about profits later, how do you plan to cover those costs in the meantime?"
One of the biggest challenges faced by Netscape and other internet startups was profitability.
No matter how good a technology or service was, in a capitalist society, if it couldn’t generate revenue, it was ultimately useless.
Roy and his friends hesitated for a moment, slightly thrown off by the sharp question.
At the time, people had grand dreams and hopes for the internet, but the question of whether it could actually make money remained uncertain.
‘One of the main reasons the dot-com bubble burst was because these companies weren’t making money.’
Of course, after that, viable revenue models were established, and internet companies began generating real profits, ushering in the golden age of Big Tech.
‘In a way, this moment could be considered the true beginning of the internet revolution.’
Since Seok-won already knew how IT companies eventually became profitable, he was prepared to teach them a way to make money if they didn’t have a plan.
However, when Roy, after a brief hesitation, finally spoke, it turned out he didn’t need to.
"We're going to generate revenue through advertising."
Seok-won, impressed, couldn’t help but think that Roy was onto something.
But outwardly, he kept a skeptical expression.
"Do you really think that’ll be enough to make money?"
Banerjee adjusted his glasses with one hand and calmly explained the revenue model that the three of them had in mind.
"It won’t be easy at first, but as the number of email users grows, we’ll be able to attract more advertisers and charge higher fees, making it financially viable."
"……."
"And because of the nature of email, it's actually more advantageous for generating ad revenue compared to other internet businesses."
"Why is that?"
"When users check their email, they don’t just look at a single page and leave—they go through multiple pages."
Seok-won immediately understood what he meant, a spark of interest flashing in his eyes.
"Since users click through pages, you can insert different ads every time they navigate. That means much higher revenue potential."
"Exactly."
Seeing how quickly Seok-won grasped the core concept, Banerjee and Frank realized that he had a deep understanding of the internet business.
Then, remembering that he had been an early investor in Netscape, they suddenly understood why.
‘So that’s why he recognized Netscape’s value before anyone else.’
‘Maybe this time, he won’t reject us and might actually invest…’
As the two quietly nurtured their hopes, Seok-won stroked his clean-shaven chin, calculating how much profit he could make from investing in Hotmail.
‘It’s a given that this will be a huge success. The real question is the return on investment…’
Of course, it would be difficult to strike gold like he had with Netscape.
That said, Seok-won couldn’t help but feel a little sorry for Roy and his friends—because an email service alone had clear limitations in terms of growth.
To generate greater synergy, it would need to be integrated with a web browser like Netscape.
‘That’s why Microsoft ended up acquiring Hotmail.’
Since an M&A was inevitable down the line, profitability wasn’t something he needed to worry too much about.
‘In the end, no matter how this plays out, there’s no way I can lose.’
He could make money and also help Roy, a close friend from his Harvard days—an even bigger plus.
Looking at Roy and his friends, who were watching him anxiously, Seok-won smiled.
"Alright. I think it’s a solid idea, so I’ll invest."
The three of them had been holding their breath, fearing a rejection, but as soon as they heard his words, their faces lit up with joy.
"Really?"
"Haa…."
Especially Roy, who had been more nervous than anyone, asked again, as if needing confirmation.
"You're really going to invest?"
"Yeah. Have I ever joked about something like this?"
"No! Never!"
Unable to hide his excitement, Roy grinned from ear to ear.
Before reaching out to his friend Seok-won, he had approached several venture capital firms, only to be rejected time and again. His confidence had taken a serious hit.
He had started questioning whether the idea he thought was groundbreaking was actually worthless.
But now, with Seok-won agreeing to invest, it wasn’t just about securing the money—it was about validation. Their idea wasn’t wrong. And that realization filled him with overwhelming emotion.
Seok-won waited for the three to calm down a bit before straightening his posture and speaking seriously.
"Before finalizing the investment, we need to discuss the most important matter first."
He looked directly at Roy and his friends sitting across from him and asked,
"How much investment are you looking for?"
At that, Banerjee, after exchanging a quick glance with the others as if they had discussed this beforehand, answered cautiously,
"We’ll need at least $3 million to launch the email service."
"Hmm. $3 million, huh?"
Seok-won folded his arms and appeared to be deep in thought upon hearing the amount. Sensing his hesitation, Banerjee quickly added,
"We need that much to purchase servers, acquire the necessary equipment, and hire staff to operate the system."
"That’s right."
"And that’s the absolute minimum we’ve managed to cut it down to."
Perhaps worried that Seok-won might find the amount too high, the three of them took turns justifying the figure.
But considering the scale of Seok-won’s wealth, $3 million was nothing more than a drop in the ocean.
Though inwardly amused, he kept a calm and composed expression as he spoke.
"If I invest $3 million, how much equity are you offering me?"
"About 30% seems fair…"
Banerjee answered hesitantly, sneaking glances at Seok-won’s reaction.
"$3 million for 30% equity means you’re valuing the company at $10 million."
Banerjee instantly wondered if they had asked for too much and felt a tinge of regret. Still, he tried his best not to let it show.
"We believe it’s worth that much."
"Hmm. I’m not sure if you’re aware, but my initial investment in Netscape was only $2 million."
In other words, he was asking if their startup had the same potential as Netscape, which had already made history on Nasdaq.
At that, Roy and his friends fell silent, as if on cue.
Even they knew that, at this moment, their venture was nowhere near as explosive as Netscape had been.
Frank, who had been quietly listening to the conversation, cautiously spoke up with a slightly hesitant expression.
"Well… that's the condition we're hoping for, but depending on the situation, we could adjust—"
Just as he was about to finish his sentence, Seok-won spoke up without hesitation.
"Alright. I'll invest $3 million."
"Huh?"
"Wait… what?"
The three of them blinked in surprise. They had fully expected him to either lower the amount or ask for a bigger share in return.
"You're really giving us $3 million?"
Roy asked in disbelief, and Seok-won nodded.
"Yeah. But there's one condition."
At that, Frank and Banerjee, who had been bewildered a moment ago, now looked at him with expressions that said, ‘Of course, there’s a catch.’
"And what is it?"
Banerjee, adjusting his glasses, asked in a wary tone.
With a subtle smile, Seok-won turned to Roy and his friends.
"In exchange for investing the full amount, I want a right of first refusal clause in the contract."
"…?"
"Simply put, if you need additional investment in the future, I get first dibs before anyone else."
Noticing that they seemed to understand, he continued.
"Of course, if we can’t agree on terms, you’re free to negotiate with other investors."
"So you're not saying we have to get the next investment from you, just that you'll have priority?"
Roy clarified, and Seok-won nodded.
"Exactly."
The three huddled together for a brief discussion, speaking in hushed tones. Shortly after, Banerjee, acting as their representative, gave their answer.
"Alright. We can agree to that."
Hearing this, Seok-won let a small smirk play at the corner of his lips.
"Then shall we draft the contract right away?"
TL/n -
Microsoft Acquisition & Growth (1997-2000s)
Microsoft acquired Hotmail in December 1997 for $400 million and integrated it into MSN (Microsoft Network).
It quickly became one of the most popular email services, with millions of users worldwide.
Microsoft later rebranded it as MSN Hotmail and made it a core part of its internet services.
