Chapter 21 20. Ding Lei: Hold a handful of sand in your hand

Ding Lei, chief architect of NetEase. Ding Lei graduated from Chengdu University of Electronic Science and Technology. He was obsessed with computers when he was in college. After graduation, he first worked in Ningbo Telecom Bureau. Two years later, he resigned and went south to Guangzhou. In 1997, he established NetEase.In the early days of his business, Ding Lei relied on the free e-mail system he developed to develop his business, and helped NetEase gain a firm foothold in the Chinese Internet industry.Since then, NetEase has become one of the most famous portal websites in China's Internet by providing services such as personal homepages. In June 2000, NetEase was listed on the NASDAQ in the United States, but just when the Internet bubble burst, the listing became a lament of "untimely birth", and the company's stock price fell below the issue price on the day of issuance.In the following two years, due to personnel disputes within Netease, Ding Lei took up the two positions of CFO and COO of the company alone. In 2002, NetEase encountered the most serious crisis since its establishment. Because it failed to submit the annual financial statements in time, it was suspended by NASDAQ in the United States. Ding Lei also resigned from the positions of CEO and chairman and became the chief architect of NetEase. designer.

After experiencing the peak when starting a business and the slump after listing, NetEase gradually came out of the gloom in 2003. After resuming trading on NASDAQ in the United States, NetEase’s stock price soared all the way. Ding Lei was worth 50% of NetEase’s shares. Skyrocketed, and was named the "richest man" of the year.The myth of the Internet has been solidly realized on the 32-year-old Ding Lei. In recent years, Ding Lei has been retiring behind the scenes, except for the occasional transition as CEO when NetEase's personnel changes, focusing on planning NetEase's development strategy and product design.Netease has successively developed businesses such as SMS and online games, and has firmly occupied a place in the changing situation of China's Internet because of the success of online games.

Ding Lei's most famous sentence is "Even if you fall, you must grab a handful of sand in your hands." This is not only a portrayal of Ding Lei's own life for more than 30 years, but also provides inspiration for many latecomers: even in difficult times, We must also firmly have confidence until we walk out of the darkness and usher in the light. In the process of walking, we are bound to fall, and there will be problems of one kind or another, but most importantly, these traces of us, the roads we have traveled, have left a lot for those who will walk this road in the future, and have left a lot for those who will walk this road in the future. Today's Chinese netizens have brought many wonderful services and exciting content.

Remember the famous saying: With great power comes great responsibility.Who is most responsible in that enterprise? The answer is the CEO.The story of Ding Lei tells us that the CEO is the soul of the company. In times of crisis, a competent CEO will be brave enough to take responsibility and work hard with his subordinates. background of the crisis Ding Lei and Netease have reached the most critical moment. On July 19, 2001, NASDAQ in the United States sent a notice of suspension to NetEase. At this time, it was just over a year before NetEase went public.This letter completely pushed NetEase to the forefront, and it appeared in a rather embarrassing posture.This is the most critical and suffering moment that NetEase has encountered since its establishment.

Although Ding Lei publicly stated that it is unlikely that NetEase will be suspended in order to stabilize the emotions of employees, NetEase was pushed to the edge of the cliff in the face of the fact that NetEase’s stock code on NASDAQ was added with an “E”. , because this "E" indicates that NetEase's transaction will be adjusted to other sectors.At this time, as long as one wrong step is made, NetEase will fall into the abyss. This is a huge test for both NetEase and Ding Lei. The cause of this incident was related to Netease's chaotic internal personnel disputes in the previous period of time.In the suspension notice received by Netease, Nasdaq claimed that because Netease failed to submit annual statements to Nasdaq and the US Securities and Exchange Commission in the form of Form 20-F, it violated Nasdaq Market Rule 4310 (c) Section (14).NetEase's late submission of financial reports has already caused violations in the US securities market, which values ​​financial rules and integrity. However, NetEase did not pay enough attention to this at first, and NetEase's executives were still trapped in personnel disputes and could not escape.NetEase's official explanation for this financial problem is: Due to the occurrence of internal contract misreporting and the investigation has not yet concluded, NetEase's annual financial report was not submitted to Nasdaq in time.Previously, the company experienced a drastic personnel change, and the CFO and COO left one after another. The outside world has speculated that this is also related to the contract misreporting incident that NetEase said this time.Although Ding Lei claimed at the time that he had applied for a hearing on the misrepresentation of the contract, NetEase encountered a ruthless "temporary suspension" in September 2001.

At this time, the Chinese Internet industry is also falling into the ice cave collectively.The dot-com bubble has burst, and once hot dot-com companies are struggling to find a way out of the cold winter even if they are not ruthlessly eliminated.Ding Lei was forced to the pass.The phrase "Life is like a bonbon, maybe you will taste it" in the movie that he always quotes is becoming his life reality.Facing the company's crisis, Ding Lei did not avoid public doubts, but stepped forward to save his "child".When he received the suspension warning, he took the initiative to disclose the misreporting of the contract and explained the situation to the employees in an open letter. This behavior prevented NetEase from greater internal turmoil during the suspension period.When the trading was eventually suspended due to alleged violation of US securities laws, Ding Lei took the initiative to take responsibility, reviewed his negligence on the board of directors, and resigned as CEO of NetEase.These actions of Ding Lei not only helped NetEase maintain communication with Nasdaq, but also stabilized the confidence of investors and employees in NetEase, enabling NetEase to get out of the shadows smoothly.

As the creator of a company, Ding Lei obviously has great ambitions, but after experiencing many operational difficulties, he clearly realized that NetEase is only the first step in the long march. "After a round of shocks, we need to dive into the business. Because we are still young and the company is very fragile, we have just begun to learn how to become a 10-year or 20-year enterprise. This is not an easy job." On January 1, 2002, NetEase resumed stock trading on Nasdaq. In the following year, NetEase's stock price soared, and Ding Lei even became the richest man in China in 2003.He once said afterwards that a big setback like the suspension of trading is a rare experience and wealth in life, and a lesson in life.

From the peak of the stock price to the bottom, during the difficult period of Netease, I realized that the best way to persuade shareholders is to keep the company's low investment and high output.Netease must insist on making content, and find two breakthrough directions in online games and mobile communications, and carry out intensive cultivation in the field.At the same time, within the company, in order to stabilize people's hearts, NetEase insists on not laying off employees or cutting salaries. Ding Lei said: The action can be slow, but the strategy must be correct, and then follow up after seeing it, so that the risk is relatively small, so that the mistakes made by others will not be repeated.Only those who can see the future clearly in times of crisis can go further than others.

background of the crisis China's Internet has only been around for more than 10 years, but everyone in it has experienced vicissitudes as if they were in the rivers and lakes. Ding Lei and the NetEase company he founded stood on the cusp of China's Internet from the very beginning. Ding Lei guarded NetEase, from starting a business to maintaining a business, falling from the peak to the bottom, and then rising again from the low tide.The Internet bubble once destroyed many companies that followed the trend, but it also pulled gold out of the big waves. In 1998 and 1999, NetEase was rated as one of the "Top Ten Chinese Websites" for two consecutive years. NetEase has jumped from a company selling email systems to one of the most famous portal websites in China. made considerable profits.Following the successful listing of Sina and Sohu on Nasdaq in the United States, Netease also officially landed on Nasdaq in the United States on June 30, 2000, becoming the third Chinese Internet concept stock listed on Nasdaq. To the Nasdaq trading center.However, the situation took a turn for the worse at this time. Since 2000, the Internet has entered a cold winter. The Internet, which was once held high, fell to the bottom, and the Internet bubble began to burst.NetEase's listing obviously chose the wrong time. It fell below the issue price on the first day of listing and trading. The stock price fell from the highest point of 17.25 yuan to 12.75 yuan, a drop of up to 15%.

At this time, the blow is not just from the evaporation of wealth on paper.When technology stocks crashed, the situation forced Ding Lei to have the idea of ​​giving up NetEase. From the second half of 2000 to 2001, Ding Lei experienced the most painful stage in his life. NetEase undoubtedly made it difficult for him to let go, but the declining stock price forced Ding Lei to make such a helpless move. To be or not to be" is a hotly debated question in the media.In the end, the negotiations with HK-CABLE seem to give Ding a glimmer of hope.However, due to the suspension of Nasdaq, this almost successful negotiation finally did not proceed further.

However, during this period, Netease did not stop moving forward. In the second half of 2000, NetEase quietly withdrew from the portal battle, and instead grasped the last straw that led it out of the quagmire - SMS.Despite the torment, Ding Lei was not overwhelmed by setbacks, but sought a breakthrough in the predicament.While calmly coping with the ensuing external crises, Ding Lei did not give up finding a way out for NetEase's growth.He found a breakthrough in the telecom value-added service business. At that time, China Mobile's SMS service was 10 cents a piece, but the profit was nearly 40%.However, NetEase relied on the accumulated user resources such as mailboxes and personal homepages, and connected with the mobile company's business platform, which could create huge profits, even far exceeding NetEase's income from advertising at that time. In January 2001, Netease became the first batch of partners of China Mobile Monternet. In 2002, China's short message "explosion" year, only relying on this year's short message revenue, NetEase came out of the shadows, successfully survived the Internet winter, and realized profitability.At the same time, the clarion call for NetEase to enter online games has also sounded. Since the beginning of this year, NetEase has finally got out of the predicament and flexed its muscles in online games. Ding Lei has obviously matured through these difficulties.When facing young people, he once said: "I never dreamed that I would one day control a company with a profit of more than 250 million yuan. I also stumbled all the way and learned while fighting." Obviously, he brought Watching Netease's courageousness when it broke out of the Internet disputes also confirmed what he once concluded, "The action can be slow, but the strategy must be correct. If you see it correctly, then follow up. This way the risk is relatively small, so that the mistakes made by others will not be forgotten. Will do it again." After this campaign, NetEase has been working hard on SMS and online games, and has gained many users in a short period of time. Life is a process of accumulation, you will always fall, even if you fall, you must know how to hold a handful of sand in your hands.I fired myself for the first time.A person's life will always face many opportunities, but opportunities have a price.Whether I have the courage to take this step will be a watershed in my life. In normal travel, everyone’s opportunities are the same, but if you fall, you will change, you may be injured, or you may see opportunities that others cannot see, but one thing is very important, after you fall, you must Get up on the spot, and hold a handful of sand in your hand. background of the crisis When Ding Lei became China's richest man in 2003, he was only 32 years old. He said that the richest man is not the richest man, but just a title. He didn't like being called "the richest man" and thought the ranking was boring.He has experienced ups and downs in China's Internet world in order to "make NetEase a century-old store".His answer to the secret of success is: What I have always insisted on is my love for the Internet, keen market insight, constant pursuit of technology, and frugal housekeeping.Unlike the lifestyle of many rich people who spend money like water, Ding Lei seems to have a weak concept of money. He cares more about technology, products and the development of NetEase.He advised young people that no matter how the workplace changes, the important thing is to embrace ideals and never give up. Ding Lei's ideal of the Internet has continued with the birth of NetEase.Like many young entrepreneurs, Ding Lei's entrepreneurial journey has not been smooth sailing.After graduating from university, Ding Lei got a job opportunity that seems to be very good now-a job in Ningbo Telecom Bureau, which is stable and has a good income. This is a job that was envied by young people at that time.However, Ding Lei’s ideals could not bear to continue working in a unit like the Telecom Bureau. In 1995, under the strong opposition of his family, Ding Lei resolutely resigned from his job and went south to Guangzhou.He said frankly afterwards: "This is the first time I have fired myself. Opportunities come at a price. Whether you have the courage to take this step will be a watershed in life." If there was no going south at that time, there might not be NetEase and the richest man in China later. Resigning and going south is undoubtedly driven by ideals in my heart, but the process of wandering outside is always full of hardships.After Ding Lei arrived in Guangzhou, he joined Sybase Company as a technical engineer.Although this is a foreign company, for Ding Lei who is full of creativity and ideas, this cannot meet his professional requirements.However, within a year, he resigned from the company and planned to start a new business by himself and start an Internet company. Under the environment at that time, there were not many people using the Internet in China. Ding Lei started his business in a difficult environment only with his enthusiasm and confidence in the prosperity of the Internet. The 7-square-meter hut is the office, with a registered capital of only 200,000 yuan and only 2 or 3 employees.Entrepreneurship is often difficult and the future is uncertain. Fortunately, Ding Lei's confidence in himself was enough to support his rapid development at NetEase. NetEase also created many firsts in China's Internet after going through the difficult period of entrepreneurship. Ding Lei believes that running a business is a learning process, and he himself has grown up from stumbles. "Confidence is very important." Ding Lei has maintained his confidence in the Internet and NetEase since he started his business. Even in the most difficult period, he did not give up.Ding Lei once sent a sentence when facing young people: "If you have confidence, you will not succeed, and if you have no confidence, you will not succeed." Obviously Ding Lei's success is inseparable from his never giving up on his career. Even if he falls, he will "grasp A handful of sand in his hand.” It is precisely by relying on the “sand” in his hand that he can keep walking in the Internet world where the waves wash away the sand.