Chapter 30: Even a Mosquito’s Leg Is Still Meat

After settling matters with Wen Huiying, Gu Cheng spent two days wandering around Quan Shunyu’s company. There, a mountain of forged contracts had long piled up, all waiting for Gu Cheng’s personal seal—these were necessary to legitimize the money Huang Yi paid him as if it were for proper copyright transactions.

As for Quan Baoya, Gu Cheng didn’t get a chance to see her again. According to Quan Shunyu, his sister was currently in seclusion before her official debut, kept in total isolation by the company. She was recording albums and shooting music videos every day; even her phone had been confiscated.

Naturally, Gu Cheng had a more important matter to discuss with Quan Shunyu. One day, after clearing the accounts, Quan Shunyu invited him out for drinks. At the table, Gu Cheng casually brought it up, “Brother Quan, there’s something I’d like to ask you about—the ‘North-South Joint Declaration,’ you know about it, right? The Kaesong Industrial Zone seems to have opened up recently.”

Quan Shunyu was a bit surprised, but answered directly, “Of course I know. Why do you ask?”

Gu Cheng came straight to the point, “So, do you have any friends who could find an excuse to get into the Kaesong Industrial Zone in the near future?”

“What do you want to do in Kaesong?”

“Don’t worry about that. Just tell me if it’s possible.”

“Well…” Quan Shunyu racked his brains for a moment. “If you don’t mind the pretense, I can borrow the name of a tourism development company from a friend and squeeze someone in on a site inspection—but you know the drill, there’ll be some palms to grease, and we’ll have to make sure we don’t actually poach any business.”

The Ministry of Culture and Tourism, naturally, had both culture and tourism branches, and the children of officials there had easy access to privileges—many ran publishing houses or travel agencies.

Gu Cheng was decisive, “Don’t worry, I’m not getting into tourism for real. Just want to take a look. Who would bother with actual tourism business?”

“Then why don’t you just tell me exactly what you’re after?”

After a brief hesitation, Gu Cheng decided to be honest to earn trust. “You know, my grandmother was a war orphan. Her father died in Kaesong back then, and some of his belongings were never retrieved.”

Quan Shunyu considered it. “That shouldn’t be a problem, but there’ll be some upfront costs…”

Gu Cheng thought for a moment. “A hundred thousand yuan, in RMB. How’s that?”

“I’ll arrange it for you, but don’t be in a hurry. As far as I know, Kaesong won’t open to southern inspection teams until after the bereaved families’ meeting on August 15. And given your ambiguous status, it’ll be hard to get you in right away. You’ll have to wait a few months.”

Gu Cheng noted that silently and toasted Quan Shunyu twice—the matter was settled.

After the drinks, Quan Shunyu seemed to remember something and added, “Speaking of the Kaesong Industrial Zone, that reminds me—my sister’s company gave me a bunch of tickets to her debut concert. But my father will be away on business in Kaesong for the next few months and definitely won’t be back by August 25. So I’ve got an extra ticket—take it and go see her.”

As he spoke, he handed a ticket to Gu Cheng.

Gu Cheng wanted to mention that Miss An had already given him one as he left the company, but he thought better of it and simply kept the ticket.

...

By the time everything in Seoul was wrapped up, it was already late June. His deal with Huang Yi was nearly done—the final payment was due, and the evidence had to be destroyed.

Gu Cheng didn’t have time to dawdle. He flew straight back to Beijing and headed to Zhongguancun to finalize the last transaction with Boss Ding.

Naturally, Boss Ding kept his word. He was a man out to make big money, not one to quibble over small change.

On June 28, Boss Ding called Gu Cheng over for the last time and had his finance team settle the final payment, then brought out a bottle of champagne and clinked glasses with him.

“A pleasure working with you. I’m flying to New York tomorrow, and the day after, I’ll be ringing the bell.” Boss Ding was brimming with confidence, his excitement making the mole on his face glow red.

Gu Cheng offered his congratulations at just the right pitch. “I’ll be watching your stock performance. I believe the data services I provided were well worth the price.”

After draining his glass, Boss Ding left.

Two days later, on June 30, at the NASDAQ in New York.

Huang Yi’s stock IPO price was $9.60 per share, much higher than the $8.20 estimated two months earlier. The IPO expanded by more than 20 million shares.

So, the data services Gu Cheng provided essentially helped Huang Yi raise nearly $30 million more from New York brokers.

Gu Cheng tracked all of this in real time from China. Everything was proceeding according to plan.

Boss Ding had paid nearly ten million RMB in commissions, about 4% of the additional financing (the RMB-USD exchange rate was still 8 to 1 at that time).

Normally, this commission rate was excessive—2% would’ve been standard.

But on the eve of the coming capital winter, to escape, even 4% had to be paid.

As for Gu Cheng’s cut, it was a bit lower than he’d hoped. He’d expected to net 3.5 million, but in the end, took home only 3.1 million. Wen Huiying discovered his plan ahead of time, forcing Gu Cheng to pay her 200,000 hush money. Two other top hackers Wen Huiying brought in, though never in direct contact with Gu Cheng, also spotted some business loopholes and renegotiated for an extra 100,000 each.

This kind of business was never meant to last. Once the word got out and others caught on, the monopoly was gone.

From then on, it would be a mad scramble to expand, speed up, and wage price wars.

So, as soon as Boss Ding’s money landed, Gu Cheng immediately pulled in two new clients he’d been courting.

While working with Huang Yi, he hadn’t been idle—every day, he was calculating which companies in China’s internet scene had fundraising plans, who needed to inflate their valuations, and noting them all in his little book.

“Sohu and Sina are already listed, not looking to raise funds, so forget them.”

“Ma Feng from Ali got $20 million in VC from Masayoshi Son at the end of last year, so he’s not short on cash for now. Li from Baidu also got $20 million last year.”

“Tencent is more strapped for cash than Baidu, but VCs judge QQ by registered users, not daily active IPs; that’s not my specialty, so I’ll stay out.”

“Lei Jun’s Kingsoft is planning a share increase. Zhou Hongyi’s 3722 is in talks for a Series B VC round—these are big clients.”

In the last two or three days of June, Gu Cheng personally visited Kingsoft and 3722, pitching his data-boosting plan to each.

Lei Jun and Zhou Hongyi, having just witnessed Huang Yi’s miraculous growth, finally realized what was going on and immediately struck deals with Gu Cheng—though they did manage to bargain his price down a bit.

These deals were nowhere near as large as Huang Yi’s, but every little bit counts.

Gu Cheng’s data services helped both companies raise much more money—on the order of tens of millions of dollars. In particular, Zhou Hongyi’s 3722, after receiving new VC funding, reportedly upgraded to a new office in Zhongguancun.

Gu Cheng earned 1.1 million and 800,000 RMB commissions from the two companies, respectively.

When he worked with Huang Yi, his net profit margin was about 35%. With Kingsoft, it dropped to 27%, and with 3722, only 23%.

“Data providers” were springing up like mushrooms after rain, and Gu Cheng’s margins were shrinking fast.

He guessed it wouldn’t be long before hackers with botnets would bypass intermediaries like him entirely, and the market would become fully transparent.

Among all the bad news, there was one silver lining for Gu Cheng:

The supply price from his “hacker suppliers” was gradually dropping.

This was no surprise. The world is flat. As word spread in the industry that boosting IP traffic could be done with botnets, Chinese hackers using the “Glacier” virus were naturally motivated to expand their networks.

So, by July, hackers who previously controlled only fifty or sixty thousand bots grew their networks to over a hundred thousand in just a month.

With abundant local supply, unit prices dropped. Meanwhile, East Asian hackers still demanding high prices slowly faded from Gu Cheng’s supplier circle due to failed negotiations.

In East Asia and Japan, business brokers like Gu Cheng began to appear, and by August, the practice had spread across the ocean to the United States.

In the internet world, there are no secrets.

Just as Gu Cheng was preparing to wrap up his old clients and retire, thinking the business had no future, a promising opportunity fell into his lap.

It happened at the end of July, when he went to collect his final payment from Zhou Hongyi. Zhou, having just moved into his new office, stalled on the payment and changed the subject: “Gu, let me introduce you to a business deal. What do you think?”

“What is it?”

“Waive 300,000 from my final payment, and I’ll tell you about this opportunity.”

Gu Cheng thought, I only made 800,000 off you, and gave Zhou a sidelong glance.

After some haggling, Gu Cheng agreed to waive only 100,000 in exchange for the tip.

Zhou Hongyi agreed; after settling accounts, he said:

“In our circle, there’s a company called Silver Fox Mail. Currently, it’s the third largest email provider in China after Huang Yi and Sina, and it’s quite popular and has significant market share among overseas Chinese.

“The founder, Zhang Long, recently sensed the risk of the bubble bursting and plans to sell his company and cash out. He’s in talks with a VC firm. My sources say they’ve offered him $12 million for a 100% buyout. But Zhang isn’t satisfied with the price, and they’re still negotiating.

“If you help Zhang boost his numbers right now, wouldn’t he be willing to pay a hefty fee? I’m giving you this tip for a steal today—such a valuable lead, only 100,000.”

At first, Gu Cheng felt he’d overpaid for this information—the company’s value was only $12 million, smaller than any client he’d worked with, barely a third of Zhou Hongyi’s own 3722.

“This tip is worth 100,000?” Gu Cheng nearly lost his temper with Zhou.

Zhou hurried to explain, “You’re missing the point—listen carefully. I said Zhang Long is planning a full sale, not just seeking investment. That’s a whole different matter. He’ll pay much more than I ever would.”

Gu Cheng chewed over Zhou’s words and finally saw the light.