readsfreenovel Chapter 486 Equity Swap
Chapter 486 Equity Swap
Ele.me's headquarters is located in a not-so-new office building in Putuo District, on the 12th floor. It's not as grand as JD.com's building, but it's conveniently located.
The subway entrance is downstairs, and it's only a 200-meter walk from the station. After hearing that Lu Ran had arrived, the receptionist made a phone call and then personally led him to the meeting room.
Liu Chengdong was already waiting.
He looked to be under fifty, with a buzz cut, wearing a dark gray fleece jacket over a black T-shirt. He didn't look like a co-founder of a startup; he looked more like a regional manager who spent years on the front lines of business.
He stood up and shook hands with Lu Ran; his palm was rough and covered with a thin layer of calluses.
"Mr. Lu, Mr. Zhou mentioned what you're doing to me. He said you have a system that can help food delivery platforms reduce costs. I'm quite curious, could you tell me about it?"
Lu Ran didn't beat around the bush.
He turned on his computer, projected the AI application solution for the food delivery industry onto the big screen, and began to speak.
First, there's the optimization logic of the delivery scheduling system—using AI to analyze order distribution and rider locations in real time, dynamically planning the optimal delivery route, and minimizing riders' empty driving time and waiting time.
Then there's the order forecasting part—using historical data and real-time traffic to predict the order volume for the next half hour to an hour, and to allocate transportation capacity in advance to avoid order backlogs during peak periods.
The third aspect is cost optimization—after improving delivery efficiency, the same order volume can require 10% to 15% fewer riders, thus reducing delivery costs accordingly.
The cost reduction can be passed on to users by the platform, or it can directly increase the platform's profit margin.
He didn't give specific numbers, but he explained the framework and logic very clearly.
Liu Chengdong did not speak immediately after hearing this.
He looked down at the printed summary of the plan in front of him, flipping through it twice, then looked up and asked a very direct question: "If this system is integrated into Ele.me's system, how long will it take to see results?"
"The first phase, delivery scheduling optimization, should be operational within a week if things go smoothly. The second phase, order forecasting, will take two to three weeks. The third phase, cost optimization, should show significant changes in about a month."
Liu Chengdong tapped his fingers lightly on the table twice: "Then let me ask a more specific question. This set of equipment isn't given to us for free, is it? How much are you planning to charge?"
Lu Ran leaned back in his chair and closed his laptop. "Mr. Liu, I'm not here today to sell you technology. I can let you use the technology, but it's free."
Liu Chengdong paused for a moment, and stopped spinning the pen in his hand.
He didn't rush to reply, waiting for Lu Ran to finish the second half of his sentence.
"I'd like to do a share swap with Ele.me. TUTU Technology will give up a portion of its shares to Ele.me in exchange for a small percentage of Ele.me's shares in return. The percentage doesn't need to be large; three to five percent would be enough. After we're tied together, Ele.me can use TUTU's AI technology to optimize delivery and reduce costs, while TUTU can get a stable entry point within the Ele.me app, allowing users to directly access our game through the Ele.me page."
He paused, allowing Liu Chengdong time to process his words, before continuing, "Mr. Liu, I know any founder would hesitate about giving up shares. But let me be blunt—Meituan's market share already exceeds 60%, and they have Tencent's social traffic portal to support them. Without a new variable that can disrupt the existing landscape, this gap will only widen. TUTU's AI technology is that variable. You use technology to reduce costs and improve delivery efficiency, using the saved profits to wage a price war with Meituan. Without this variable, you can only watch helplessly as Meituan gradually devours the remaining market share."
After hearing this, Liu Chengdong remained silent, because he knew that although Lu Ran's words were harsh, they were very true.
He put down his pen, crossed his hands on the table, stared at the summary of the proposal for a long while, and then looked up again: "Let me think about it."
"Of course. This isn't a decision that can be made in a day or two; you can take your time to consider it."
Liu Chengdong did not respond.
He stood up and walked to the window, standing with his back to Lu Ran.
Outside the window, one can see the buildings of varying heights in Putuo District, and in the distance, vehicles flow endlessly on the Wuning Road Bridge. The afternoon sun shines through the glass, casting bright spots on the desk in front of him.
Lu Ran did not urge him.
He sat quietly in his seat and waited. He picked up the water glass on the table and took a sip. The water was warm, not scalding.
About three minutes later, Liu Chengdong turned around.
He didn't go back to his seat, but stood by the window and said, "If it's three percent, can you accept that?"
"Yes. Anything up to 5% is fine."
Liu Chengdong walked back to his seat, sat down again, picked up the summary of the proposal, flipped through it once more, and then put it down: "I have one condition. If, after the AI technology is implemented, the improvement in delivery efficiency does not meet your expectations within six months, the equity swap will be void, and I will compensate you for the technology usage fee at market price. Conversely, if the expectations are met, the ratio can be as you stated, and I will not attach any further conditions."
Lu Ran thought for a moment: "Okay. But I have one condition—TUTU will decide the location and display format of the entrance. It can't just be a recommendation in a corner; users need to be able to see it without deliberately searching. We'll have the product team coordinate the specific design later."
"no problem."
The two then chatted about some details for about half an hour.
Which business data needs to be made available to the AI engine, to what extent should the data be anonymized, how should the technical team coordinate, and in which city should the initial testing be conducted?
Each rule is specific and actionable, without any unnecessary embellishments.
Towards the end of the conversation, Liu Chengdong leaned back in his chair, his expression much more relaxed than when they first met.
He picked up his now-cold teacup, took a sip, and spoke as if to someone he'd known for a long time: "Mr. Lu, have you been negotiating similar deals with a bunch of companies lately? I heard from JD.com that you've already finalized the deal. Now you're coming to me again. Are you planning to tie all the decent-sized companies outside the Tencent ecosystem together?"
Lu Ran did not deny it: "If I said yes, would you think I'm too ambitious?"
"No," Liu Chengdong said. "On the contrary, I think this idea makes a lot of sense. Tencent's ecosystem is too big; one company can't beat it. But if you bring together the second and third-largest players in several different sectors, with each contributing their strongest resources in exchange, the combined power might not be weaker than Tencent's. JD.com has e-commerce, Ele.me has food delivery, and you have technology and user communities. If you bring in one or two more companies specializing in travel or entertainment, the alliance will have comprehensive coverage."
"This is what I plan to do," Lu Ran said.
Liu Chengdong nodded, stood up, and extended his hand: "Let's see if this cooperation can get off to a good start."
Lu Ran also reached out and shook hands with him firmly.
Liu Chengdong's palms were still rough, with a thin layer of calluses. When he shook hands, he didn't squeeze hard; he just held on firmly.
It was already getting dark when I left Ele.me's headquarters.
In early spring, evenings in Shanghai arrive a little later than in winter; around six o'clock, there is still a sliver of dark red afterglow on the horizon.
He stood on the steps at the entrance of the office building waiting for his car, mentally reviewing the framework they had discussed that day.
A 3% equity swap, integration of the AI delivery system, and a fixed entry point in the Ele.me app.
With these three factors combined, TUTU Technology now has another user entry point that is not controlled by Tencent.
JD.com solved the shopping scenario, while Ele.me solved the dining scenario.
Eating and shopping are things everyone does every day, more routine and irreplaceable than games.
If users can directly access TUTU's game products through Ele.me and JD.com's pages, then even if Tencent completely cuts off the WeChat login interface, TUTU will still have two independent user acquisition channels that do not rely on Tencent.
He is also considering ride-hailing apps and short video platforms.
Travel and entertainment are two other high-frequency scenarios. If each can be partnered with a different company, the coverage of this network will be basically complete.
As for the specifics of the negotiation and what conditions to exchange, he hadn't decided yet.
But his approach has remained unchanged—using AI technology as a starting point and equity swaps as a rope to link together the second and third largest companies in their respective sectors.
Once connected, no single company needs to go head-to-head with Tencent, but each company can obtain something from this network that they couldn't get on their own.
This kind of community of shared interests is much more stable than going it alone.
The car arrived, and he opened the door and sat in the back seat.
His phone vibrated. He took it out and saw a message from Zhou Mingzhe: "How did the talks with Ele.me go?"
"It's a deal. 3% equity stake, AI-powered delivery integration, and app access. Specific details will be released in a written document next week."
"Okay," Zhou Mingzhe replied with a single word.
A little while later, he added another message: "If Meituan knew that Ele.me was cooperating with us, they probably wouldn't just sit idly by."
Lu Ran looked at the message and thought for a moment before typing a reply: "It doesn't matter if they know. They dare to wage a price war in the food delivery market because Ele.me's delivery efficiency and cost structure can't keep up with them. Now that Ele.me has AI optimization, the gap in delivery efficiency and cost structure will narrow to a point where it can compete with Meituan. If they continue to wage a price war, Ele.me, with its lower costs, will have even more confidence."
After sending the message, he put his phone on the seat, leaned back on the cushion, and closed his eyes for a while.
The night breeze of Shanghai slipped in through the cracks in the car window, cool and refreshing, carrying the aroma of charcoal and cumin wafting from a barbecue stall across the street.
He rolled the car window up halfway and closed his eyes again.
My mind was racing with thoughts of the companies I was going to talk to next.
He hasn't yet identified specific individuals to work with in the travel and entertainment sectors, but the general direction is clear.
The market structure of ride-hailing apps is similar to that of food delivery apps—Tencent-backed companies dominate, while the remaining companies struggle on their own.
Tencent is also making deep investments in short video platforms, but fortunately, Kuaishou and Douyin remain independent in the world and have not been invested in by Tencent.
I just don't know if this behemoth, Kuaishou, is willing to do a share swap with me.
After all, the size of Kuaishou is much larger than mine.
However, with such a large user base, if Kuaishou and Douyin could further improve their recommendation algorithms, their revenue could reach even greater heights.
The founder of Kuaishou and Douyin is a tech fanatic who never follows the rules, which presents an opportunity for both parties.
After all, Lu Ran is a madman.
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