CH58 - Investment

Ethan's surprised words earned him a scolding from Jobs in a black T-shirt.

"Oh, damn! You ask me how I came? Well, I want to know why you didn't contact me!"

"MOS is officially producing the 6502 in Mountain View! Heard you're still a shareholder in that company?"

"Darn! How could you not tell me about such a big thing!"

"Are we still brothers?"

"Yeah."

Ethan's angered words left a twitch at the corner of his mouth. He suddenly remembered that Jobs had mentioned computer manufacturing to him before. It seemed they had reached some kind of understanding back then. But in the excitement of MOS's generosity, he had forgotten.

"Oh, damn! How did I forget about Apple!"

Ethan cursed in his mind, but his facial expression remained unchanged.

Even...

He squeezed out a bit of grievance.

"Oh, Steve, you're really misunderstanding me. I've been busy with MOS, handling site selection (glance), registration (signing), equipment procurement (listening to reports), official production (knowing it's a thing) – all these things are on me."

"I was planning to contact you after the first batch of chips came out, wanted to give you a surprise."

"But... you knew beforehand?"

"Oh, I'm really sorry. I didn't do a good job of keeping it a secret."

Ethan pursed his lips, a look of regret on his face.

At this, the bewildered Jobs stuttered, "WWW... What? You wanted to surprise me?"

"Yeah," Ethan nodded, a smile appearing on his face.

But before it lasted a second, his smile was replaced by regret. "Last night, I was busy until dawn. I thought the results of the trial production would be out these days. Don't you want to make computers? So I personally supervised them, wanted to urge them to hurry."

At this point, he shrugged, saying, "But... I'm sorry... maybe my behaviour was a bit inappropriate..."

"Letting you misunderstand."

"..."

Jobs' softened attitude relieved Ethan. He knew he had played it well. He waved his hand, indicating he didn't mind.

Then he invited Jobs inside to discuss the details of computer production.

Given his guilty conscience, Jobs naturally didn't refuse such an arrangement.

However, just as Jobs pondered whether his self-righteous behaviour was inappropriate, in the process of following Ethan through the living room and preparing to go upstairs, he suddenly heard these words:

"Ethan, don't you eat breakfast? Didn't you say you were starving around nine last night? If I remember correctly, you even asked Evelyn if she wanted fried chicken. If Thomas hadn't kicked you two out of the kitchen, would you guys be complaining about getting fat today? Then blame us for not helping you control your diet?"

"Sometimes I really wonder when you guys learned to shirk responsibility. You weren't like this before!"

"..."

"Thanks, Aunt Linda!"

Ethan's face stiffened.

He glanced at Jobs.

The long-haired old Jobs, who had combed his hair behind his head, first froze, then smiled, and his mouth curled up.

At the same time, he rolled up his sleeves and raised his eyebrows.

"Oh, Ethan—busy until dawn?—Ah ha?"

"Misunderstanding, all misunderstandings..." Ethan's cheeks tightened, hastily saying, "Maybe I remembered it wrong. Let me think, let me think, last night? Last night, I was at home. Watching the factory production was the day before yesterday? Right, right, right! It was the day before... Hey, hey, hey! Steve! Steve! Let's talk nicely, don't get physical!"

...

Ten minutes later, in Ethan's room.

Jobs, who hadn't eaten breakfast, was devouring the apple sandwich Linda had made, while Ethan sat on the bed, sipping cereal, vaguely saying, "That's how it is. Because the patent issue of the 6502 is too troublesome, I really forgot to call you and tell you the chip problem was solved."

When Ethan told Jobs about his experiences in the past month, the handsome guy with long hair no longer got angry. At the same time, he exclaimed, "Ohhhh... Illegal actions in other states are legal in California? Is this because of lenient California laws or the brilliance of Stanford Law School professors?"

Of course, he didn't dwell too much on such trivial matters. After learning from Ethan that the 6502 chip was now safe, Jobs didn't hesitate and directly asked, "Can I buy the chips now?"

"Of course!"

Ethan nodded, slapping his thigh.

"How many chips do you want?"

"I'll help you order!"

"Internal cost!"

"Twenty-five dollars each!"

Ethan's core purpose for developing the 6502 was to tap into a larger commercial market. When Jobs told him about Woz's military background, even if Jobs didn't want to make computers now, Ethan would pull out a gun and force him to! Yes, that's how determined Ethan was!

As for the price of the 6502?

He had already negotiated with MOS. The initial external price was $42, and it wouldn't drop before the upcoming San Francisco Electronics Expo. After the expo, if Motorola and Intel followed suit in reducing prices, they would drop the price from $42 to $25, and it would stay that way for some time, depending on market demand.

If the market demand is high, they will reduce the price of the 6502 to the final price within a year, $12 per unit.

Although from a business perspective, this proactive price reduction seems a bit brainless, a thousand coins can't buy my willingness.

Moreover, the production cost of the 6502 is only $2. Even if sold for $12 per unit, after deducting other costs, the net profit is still around $6.

So, it's just a matter of more or less profit.

And Ethan, as a shareholder, can get the next stage's price in advance.

This is Chuck Peddle's gratitude and a small benefit from MOS.

Ethan's straightforwardness also brought a happy smile to Jobs' face.

He extended two fingers and gestured in front of Ethan.

This gesture made Ethan understand.

"Twenty thousand units, right? Okay!"

"Fifty thousand dollars! Money upon delivery!"

However, before his words could settle, Jobs quickly waved his hand, saying, "No! No! No!... What twenty thousand units? It's two hundred! Two hundred!"

"I want two hundred 6502 chips!"

"And..."

"I don't have money."

Jobs spread his hands.

A posture that seemed like he was here for charity.

"???"

This situation really stunned Ethan!

To be honest, when Jobs gestured with two fingers, Ethan knew that this guy probably wanted two hundred chips. He mentioned twenty thousand just to make a joke, to see how Jobs, under tension, would react.

But...

Whether Jobs showed signs of panic or not, Ethan didn't know. But he knew he was now subdued by Jobs' trickery.

No money to buy chips? Isn't this the same as going to a restaurant without bringing any money?

This is 1975!

Not 2020!

The timeline is messed up! How come someone started zero-cost purchasing!

More importantly, this zero-cost purchase fell on Ethan Jones!

Staring at Jobs for quite a while, confirming that he wasn't joking, Ethan Jones asked in a bewildered manner, "Steve, do I look like someone from a wealthy family?"

This question left Steve Jobs stunned for a second.

After a moment, he regained his senses and laughed heartily, "Yes!"

"If you need, I can even sing 'Ah! Everything will be fine' for you now."

"Les aristocrates à la lanterne! (Throw the aristocrats to the lamppost!)"

"Les aristocrates on les pendra! (Hang the aristocrats on the lamppost!)"

"..."

"Ha-ha-ha!"

Ethan couldn't hold it in and burst into laughter.

As he laughed loudly, Jobs couldn't hold back either, leaning on the table and laughing.

After a long while, when Ethan recovered, he slapped his thigh and said, "Okay, let's be serious, Steve. If I remember correctly, you have money, right? When we went out to change the motherboard last time, you should have earned more than five thousand, right?"

"It's only been a few months? You've spent it all?"

Ethan's inquiry left Jobs silent.

After contemplating with averted eyes for a moment, he finally pursed his lips and said, "Yes, I spent that over five thousand dollars."

"..."

This fact left Ethan unsure of what to say.

Just as Ethan was pondering if this guy had squandered it all on gambling or something, Jobs continued, "I used that money to renovate the house at home. It's an old house from decades ago, and the last renovation was six or seven years ago. The remaining money, I used to buy a car for my father. It's a Ford, and he really likes it because he's a car mechanic. With the Ford, he can easily get spare parts."

"Of course, he had a pickup truck before, but who doesn't like a new car?"

"My parents also asked me where the money came from. I told them it's what I earned with my friend. When they knew that I became friends with the inventor of 'Snake Game,' they were very happy, saying that I finally stopped messing around."

"You may not know, but they have been quite worried about me. Although they didn't say much when I pursued trends, they were actually quite sad. When I went to Asia last year, they were even afraid that I wouldn't come back."

Jobs' words left Ethan stunned.

Although the figure sitting by the table was smiling, Ethan could sense a faint sadness emanating from him.

"Oh, really? Then I'll cover the money for buying chips for you."

Ethan took a deep breath, approached the table, and took out his chequebook from the drawer.

He wrote a check for fifty thousand dollars and handed it over.

"This fifty thousand dollars counts as my sponsorship for you. Five thousand for the chips, and the rest for making computers. Is that enough?"

"And, regardless of whether your small business succeeds or not, you don't have to pay me back."

"I can help Chuck Peddle, this unfamiliar person, fulfil his dream, and I won't be stingy with my friends."

The light check made Jobs delighted. After receiving it carefully, he also said with a smile, "Oh, Ethan, you really understand me. Why should I return the money I earned with my own ability?"

Before his words could settle, the next moment, he said again, "Okay, no kidding. If I start a company, consider this your investment, 20% of the shares? Steve Jobs has always been this generous in business!"

"Then... I'll add non-dilution clauses to your separate shares? How about giving you both structural anti-dilution clauses and full-ratchet clauses? What do you think? I, Steve Jobs, still know a bit about business!"

"Ha-ha-ha—"

Jobs' cute appearance made Ethan Jones burst into laughter. Opening his arms, he embraced him and loudly exclaimed, "Then, for my own benefit, I have to wish you success in advance, Steven!"

TL Note:

Jobs had a good relationship with his adoptive parents. When he was bullied at school, his adoptive parents used all their savings to transfer him because they had promised Jobs' biological parents to send him to college. He attended Reed College, which is a good school. In the first university rankings in 1983, Reed College ranked in the top ten in both liberal arts and sciences. Of course, tuition was expensive. In 1971, the tuition was around $2500 per year. Jobs' adoptive parents really spent money on him.

Structural anti-dilution clauses grant investors the right to prioritize the subscription of equity proportional to their existing holdings when the company undergoes subsequent financing, preventing their equity share from decreasing due to future capital increases.

Full ratchet clauses mean that regardless of how much equity is involved in subsequent financing if the valuation of the subsequent financing is lower than the valuation of the investor's initial investment, the investor's equity will be adjusted accordingly to the lower subsequent financing price. It's colloquially known as forcing the company to pay back if it doesn't do well. In reality, this is rarely used, and at most, some partial ratchets are applied because this essentially means the founders found an investment daddy for themselves. As for the part in the text? Consider it Jobs joking around.