California, Redwood City.
Conference room at Silicon Valley Online headquarters.
The air felt heavy, almost stagnant.
Sequoia Capital partner Donald Valentine—a legendary figure who could stir up storms across Silicon Valley—was scrutinizing the three people seated opposite him with hawk-like eyes.
Frank Marshall, the newly appointed CEO, sat upright in a tailored suit, calm and composed.
Tom Kalinske lounged casually, his feet tucked under the edge of the table, posture relaxed but eyes brimming with confidence.
And then there was Director Sugiura, who had traveled all the way from Tokyo.
Sugiura sat ramrod straight, hands folded neatly, his expression solemn—the very image of a fully empowered representative of headquarters.
In reality, his mind was replaying Takuya Nakayama's parting advice over and over again:
"Bring your best suit, practice your golf swing, and just listen to them brag."
"A thirty-million-dollar valuation," Donald finally said. His voice was even, but carried unquestionable authority. "For a company that's just released a new product, Sequoia's offer is, as always, sincere."
Tom Kalinske nearly laughed out loud.
Thirty million? That was pocket change.
Frank Marshall, however, calmly slid a document across the table. "Mr. Valentine, I think you may want to take a look at our latest daily active user data—and this as well."
Donald's deputy took the file. After a single glance, his expression changed sharply. He leaned in and whispered something into Donald's ear.
"1.8…" Donald raised an eyebrow, though he remained outwardly composed. "A very impressive growth model. But Frank, where is your profit model? Relying on those pitiful BBS ad fees?"
"No." Frank shook his head and stood, walking to the whiteboard. "We're not selling software, and we're not simply selling ads. What we're operating is a network—a pure social network composed of hundreds of thousands of college students, and eventually, a rapidly expanding and increasingly diverse base of internet users."
He drew a circle and wrote ICQ inside it.
"Every user is a node. Every conversation is a connection. In the past, when we talked about user value, we talked about how much revenue one user could generate. Now, we're talking about how much value a single user adds to the network itself."
This was Takuya Nakayama's network value theory.
Director Sugiura lifted his coffee cup and took a quiet sip, masking the turbulence in his heart.
Clearly, this theory had already been passed along to the U.S. side. But hearing it delivered in fluent English, by a former Apple executive, with the confidence of a Wall Street elite—it felt entirely different.
These Americans really can dress up the executive director's theory in spectacular fashion, he thought.
Donald's gaze finally shifted. For the first time, he sat up straight. "Interesting. You're referring to Metcalfe's Law, using the telephone network as an analogy?"
"Not exactly," Frank replied with a smile. "The value of a telephone network leaks outward. AT&T users can call Verizon users. But our 'Silicon Valley Online Pass' is currently closed. All the value stays within our own ecosystem. Want to chat with friends from the BBS? You need an ICQ number. Want to join an interesting group? You also need an ICQ number."
"You're building a walled garden," Donald said sharply.
"You could put it that way." Frank set down the marker. "And right now, the number of people inside that garden is growing exponentially."
Just then, the conference room door burst open.
Harry rushed in, dark circles under his eyes. Ignoring everyone else, he ran straight to Frank, his voice hoarse but electrified. "F–fifty thousand! Frank! Registered users just broke fifty thousand!"
Silence fell over the room.
From fifty thousand just days ago to five hundred thousand now.
What kind of insane growth rate was this?
Donald's expression finally cracked. Even his deputy's breathing grew noticeably faster.
Tom Kalinske slowly pulled his feet back from under the table and said casually to the assistant by the door, "Aren't there more guests waiting outside? Don't keep them waiting."
The next second, a team from another top-tier venture capital firm—KPCB—entered under the assistant's guidance.
The lead partner froze for a moment upon seeing Donald, then broke into the smile of a hunter spotting prey.
"Donald, fancy seeing you here. You're interested in this little 'green sprout' as well?"
The Sequoia team's faces darkened instantly.
What had been a one-on-one negotiation turned into an auction.
Frank Marshall calmly sat back down, spread his hands, and offered a flawless corporate smile. "It seems we need to revisit the valuation model. After all, it wouldn't be fair to our partners to invest in a great future at a price they can't justify to their boards."
Director Sugiura nearly spat out his coffee.
Too ruthless. These Americans are absolutely ruthless.
They clearly wanted to drive up the price, yet somehow framed it as consideration for the investors.
Takuya Nakayama was right. All I need to do is sit here and watch the show.
The representatives from Sequoia and KPCB exchanged a look, urgency unmistakable in each other's eyes.
They were seasoned professionals. They knew perfectly well that Frank was stalling.
If they dragged this out any longer, it wouldn't stop at five hundred thousand users—one million would be inevitable. And by then, the valuation would be even more outrageous.
Better to cut cleanly.
"One hundred million dollars," Donald said through clenched teeth. "Sequoia wants five percent."
"KPCB as well!" the KPCB partner shot back immediately.
Frank and Tom exchanged a glance, then both turned to Sugiura.
Suppressing the wild joy in his chest, Director Sugiura maintained an inscrutable expression and slowly nodded.
It was done.
A one-hundred-million-dollar valuation.
Ten percent equity sold.
Ten million dollars raised.
When the news broke on the front pages of The Wall Street Journal and the Los Angeles Times the following day, the entire Silicon Valley felt as though the ground beneath it had shaken.
A company barely a year old, with a product that fit on a few floppy disks, valued at one hundred million dollars.
It completely overturned the conventional understanding of hardware manufacturers and traditional software companies.
What made even more people's eyes burn with envy was Silicon Valley Online's follow-up announcement: it would be distributing a Sega email client.
Price: just $9.99.
Overnight, the roads leading into Redwood City were choked with media pouring in from across the country.
This time, they weren't plants hired by Tom Kalinske—they were sharks who had truly caught the scent of money and change.
Standing at the entrance of Silicon Valley Online headquarters, Tom looked down at the mass of reporters clogging the street below and turned to Frank.
"Frank," he said, "looks like we need to hire some security."
Frank adjusted his tie, a smile he couldn't suppress spreading across his face. "No, Tom. We should hold a press conference—and announce what our next goal is."
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