"Don't we have profits? We're already profitable!" Hastings said, taken aback.
"But sir, we've had many expenses recently. You ordered us to enrich our film and television resource library and prepare for future online film and television plans. So we've been acquiring copyrights for various film and television resources in a planned manner. These were all orders you gave. Nearly half of our profits this year have been invested in them!" the head of finance stated.
"Then, as usual, ask the parent company for money!" Hastings said nonchalantly.
In fact, the Netflix of this world developed about three years faster than the Netflix of another world. For example, Netflix began to purchase film and television copyrights on a large scale after 2008.
The reason for this situation is that the Netflix of this world does not lack money!
The Netflix of another world, even after going public, was constantly on the verge of a funding chain collapse. The Netflix of this world, for some unknown reason, did not go public in 2002 as it did historically. It was likely Huang Laoban's butterfly effect, but the funds were still very tight.
It wasn't until Huang Laoban took over that Hastings suddenly found himself extremely wealthy and no longer needed to scrimp and save. Whenever money was tight, he just had to ask headquarters for it. Huang He was always able to provide the money immediately.
Therefore, Netflix's development speed was three years faster than in history. Hastings also developed the habit of asking headquarters for money when he ran out, hardly needing to consider the company's funding issues and thus able to carry out various expansions.
So when the finance department reported that the company account was empty again, Hastings immediately resorted to his traditional skill: asking Huang He for money.
Although Hastings had considered the possibility that headquarters might not be willing to pay given their current poor relationship, he thought it unlikely.
After all, the company only had $200,000 left. If Huang He didn't provide the money, Netflix would cease to operate immediately, and then it might go bankrupt.
Huang He had invested a staggering $500 million in Netflix. He couldn't possibly watch the company go bankrupt and have all that money go down the drain.
Therefore, Hastings was quite confident that Huang He would provide the money. Thus, Hastings didn't consider the money issue at all and continued to discuss a series of offline physical store expansion plans with his executives.
However, Hastings was well aware that Huang He would not support these offline physical store plans. So he later warned all executives that this plan must not be leaked to anyone, at least until the latest funds from Jiangnan Group arrived.
Finally, Hastings announced a 20% salary increase for all employees, eliciting a huge cheer from the entire company.
After that, Hastings instructed the relevant departments to ask Huang He for money. Under normal circumstances, after the report was submitted, it would take about half a month for the headquarters to approve the funds.
Once, when the company was in urgent need of funds, Hastings had directly called Huang He, and the money arrived within three days, quickly solving Netflix's urgent problem. So Hastings felt that this time it would at most take half a month for the money to come through. With the money, they could proceed with the offline store expansion and employee salary increases, and Netflix would be splurging, and it would be Huang He's money, which made Hastings feel very pleased.
However, that same evening, the secretary reported to Hastings that the company had received a reply from the parent company. The parent company stated that they had no money to give them and demanded that Netflix resolve its own funding issues!
"What? Isn't Huang He afraid the company will go bankrupt?" Hastings exclaimed angrily, telling the secretary to continue demanding money. But no matter how many letters were sent, the reply was always to resolve it themselves.
Finally, Hastings couldn't hold back. He called Huang He and, in a very serious tone, described the entire funding crisis facing Netflix. He then said to Huang He, "Mr. Huang He, no matter how many conflicts we have, Netflix is ultimately yours. In three days, it will be time to pay salaries, and there is less than $100,000 left in the account. We don't even have enough to pay half the employees. If you don't support us, then wait for the company to go bankrupt!"
"Bang!" As soon as Hastings finished speaking, Huang He directly hung up the phone. Throughout the entire process, Huang He had only said "Hello."
Hastings suddenly felt a bit panicked because paying salaries in three days was true. Even if salaries could be delayed for a few days, or even months, with eloquent words, Netflix's daily operations could not proceed without money.
So, he absolutely had to find a way to get money for the company.
At this moment, the only way to get money quickly was through financial means to raise funds. Since Netflix did not have the right to finance or borrow from external sources, Hastings once again dialed Huang He's number, requesting to raise funds or borrow money externally in Netflix's name.
Upon hearing Hastings' request this time, Huang He stopped playing mute. He asked sarcastically, "Have all of Netflix's debts been paid off? And you're still borrowing money!"
Then he flatly stated that he would absolutely not allow Netflix to borrow money, nor would he allow any financing activities by Netflix, which completely baffled Hastings.
"What exactly does this Huang He want? Does he really want Netflix to go bankrupt?" Hastings muttered to himself, but he didn't take this thought too seriously. Instead, he believed it was Huang He's way of retaliating, using money to strangle him and hoping he would voluntarily give up operational control of the company.
"Hmph, to kill a thousand enemies, you lose eight hundred yourself. Let's see who can hold out. I'm not short of money anyway!" Hastings sneered. The next day at work, he straightforwardly announced to all employees that due to problems with the company's funding chain, all employee salaries for the month would be temporarily suspended.
As soon as this order was announced, Netflix was in an uproar. Many vowed that Netflix might go bankrupt this time, and rumors quickly spread throughout the industry. At the same time, many employees began to consider whether they should resign.
Hastings paid no attention to this. He wanted Netflix to be in turmoil, and eventually force Huang He to provide money to clean up the mess.
As the saying goes, Huang He couldn't possibly just watch Netflix, in which he had invested over $500 million, go bankrupt.
"He will eventually give in and have to throw money at the company!" Hastings made this confident judgment.
However, it only took half a day. That afternoon, the head of finance rushed over and found Hastings, saying, "President, has the parent company gone mad? Demanding repayment at this time, are they trying to force us into bankruptcy?"
"What's wrong?" Hastings was taken aback, noticing that the head of finance was sweating profusely, clearly at his wit's end.
"Huang He's lawyers have sent us a legal letter, demanding that we repay all our debts within three days, a total of $280 million!" the head of finance said in terror.
Hastings snatched the legal letter from him. Indeed, it was a demand letter from Huang He himself, asking Netflix to repay $280 million in debt.
Some might find it strange: isn't Netflix Huang He's own company? Why the debt?
If Netflix were a wholly-owned subsidiary of Huang He, then of course there would be no such thing. But the problem was that Huang He only held 60% of Netflix's shares, while the other 40% were held by Hastings. With two shareholders, financial matters had to be clearly accounted for.
Netflix kept asking Huang He for money, and Huang He could provide it. But after the money was provided, if the company developed, Huang He would only enjoy 60% of the profits, while the remaining 40% would belong to Hastings. This was very unscientific and unfair to Hastings, who was getting such a big benefit for nothing!
Therefore, when Netflix initially asked Huang He for money, Hastings either had to increase his investment proportionally or reduce his stake in the company.
Hastings could see the development prospects of Netflix, so he absolutely refused to reduce his shares. He had invested along with Huang He initially.
When Netflix needed $50 million, Huang He would contribute $30 million, and Hastings would contribute $20 million. This way, the balance of shares could be maintained.
However, after asking for $120 million, Hastings found that he couldn't keep up. While Hastings was a millionaire, he was not a billionaire.
Of the previous $120 million, Hastings himself had contributed $48 million, which meant he had invested nearly half of his net worth. If he continued to invest, Hastings would likely have to take on debt.
So Hastings did not want to continue investing.
Huang He was also happy that Hastings didn't want to invest. So at that time, he proposed that Hastings could use his shares to offset the investment.
But Hastings was also unwilling to accept this proposal. After all, even a fool could see the development potential of Netflix. He believed that Netflix could become a company with a market value of at least tens of billions in the future, so 40% of the shares would be equivalent to $4 billion. To sell his shares for only tens of millions of dollars in the present was not appropriate.
But he couldn't do without money. So Hastings came up with another plan: to not ask for money in the name of company financing, but to ask Huang He for money in the name of company debt.
Netflix would offer a relatively high interest rate and borrow money from Huang He in the company's name, and then repay the funds upon maturity. Huang He would also receive a considerable amount of interest, thus avoiding equity issues.