Chapter 30 Light and dark lines about "The Captor"

Before investigating Delong, even though he was a front-line reporter of the financial newspaper "21st Century Business Herald", he rarely had the opportunity to go deep into the interior of a large enterprise and analyze it systematically.Before that, I didn't even know much about the capital market, because I have always been a political and economic reporter. However, the so-called "politics and economics" itself is a grotesque term, an "independent innovation" of the Chinese media, because it is difficult to find an English word corresponding to it—it is neither a pure political report nor a pure economic study.

Therefore, my personal focus has always been in a crack, that is, reports on institutional changes related to the economy. I like to study the institutional design and realistic paths of various social operating systems. In my daily reports, my focus is on the ebb and flow of the government, policies, and real economic power. Among them, the changes and comparisons of the three capital forms of state-owned, private, and foreign capital in China over the past ten years are a key point. Different from the strong return of state-owned enterprises after the establishment of the State-owned Assets Supervision and Administration Commission in recent years, in the first few years when I first came into contact with economic news, it was the stage when state-owned enterprises were generally weak and private enterprises were booming.Geographically, I am closer to Zhejiang Province, which has the most developed private economy in China, so at that time, I paid more attention to the bottom-up growth force of the Chinese economy than the top-down force.

However, I later discovered that the bigger the private enterprises, the narrower the development space, and few private enterprises can successfully jump from the big to the strong.In fact, the same is true for Zhejiang, the representative province of China's private economy.Just as the 16th Party Congress refined the Zhejiang phenomenon as a political concept, it also inevitably entered its own stage of escalation dilemma.For this reason, I once conducted a group of 10 investigations on "New Zhejiang" in the "21st Century Business Herald". The conclusion is that China's gradual reform has determined this process. The baton of innovation has been passed back from the private sector to the government.

I believe that this principle also applies to the next step of development of large private enterprises.Relatedly, since 2003, another buzzword has emerged in the field of finance and economics—heavy-duty of industry.On the one hand, because China's entire industrial structure is moving upstream in the international industrial division chain, following this change, Chinese private enterprises that focused on starting businesses in the small commodity category in the early days will naturally usher in a heavy-duty process. But for private enterprises, this heavy-duty evolution is difficult.I have always compared this wave of heavy-duty efforts by Chinese private companies to a "reincarnation". Almost all the bottlenecks they encountered ten years ago have resurfaced:

For example, the thirst for funds—although they are already wealthy, the scale of funds handled by heavy industries is several orders of magnitude larger than usual, which makes them have an urgent need for financing and melancholy about financing channels; For example, government relations—although many large private enterprises are guests of local governments, the approval power of heavy-duty industries is often controlled at a higher level. This is the first time for many private enterprises to enter the door of the central ministries and commissions. I was as excited and nervous as when I was interviewed by the city leaders for the first time;

For example, policy shackles—when the expansion of private enterprises becomes wider and wider, they will inevitably collide more and more fiercely with various current industrial and financial policy barriers.What's more terrible is that you often can't tell whether these private enterprises have too much appetite, or the policies are too conservative and outdated. And these contradictions suddenly became more obvious when the macro-control was implemented in 2004. We can observe that those private enterprises that are the first to enter the heavy-duty industry tend to fall the fastest.In the early stage of macro-air conditioning, people paid the most attention. The first one was Jiangsu Changzhou Tieben, which entered the steel industry, and the second was Delong, who ventured into the financial field.

Since then, there have been a series of crises of private enterprises, large and small. From 2004 to 2005, similar stories happened one after another in Huang Hongsheng of Skyworth, Gu Chujun of Kelon, Gong Jialong of Changlian, Yan Xiaoqun of Sweet, For Qiu Zhongbao and others from the Feitian department, when these long-worshiped tycoons are heading towards the deepest crisis since their establishment, some people are confused and sentimental, while others cheer. I found that although there are many media reports on these cases, few people systematically think about the common logic of these losers, and more people are only accustomed to looking up to the successful ones.As a result, the public quickly abandoned these losers to follow or create new icons of success.

At this time, I began to consider choosing a private enterprise to study the real cause of its failure. Although I didn't do much research on specific companies before, I think that the above-mentioned vision, which I define as "big politics and economics", is a new perspective of observation.In the future, I am sure that this is also very important for observing a micro-enterprise, especially for a super-large economic phenomenon like Delong that has surpassed the scope of ordinary enterprises. The opening chapter is so wordy, but I want to explain my consistent thinking when I wrote "The Captor" later - try to put aside simple moral criticism, use stories and details to deeply explore various institutional environments in China and the sudden development of a private enterprise. Ups and downs association.

However, at this time, there is still a chance for me to really enter Delong. I only had one encounter with Deron before it crashed.Because Delong belongs to the line of capital market reporters and has little to do with my usual business, but I was ordered by the management section in 2003 to write a small article on professional managers of private enterprises.At that time, I came into contact with a large number of international professional managers newly hired by Delong International in the industrial field. These people left me with a very different impression from the rumored ferocious animals of Delong. I have always been confused and interested, but I have never had the opportunity to delve into it.

This time, the opportunity came. On April 14, 2004, Deron collapsed, and almost all financial reporters were excited. Maybe I have to be thankful that I am not a professional capital market reporter and have not received rigid reporting tasks from the newspaper, otherwise I must have been like many reporters who first had to revolve around the anecdotes of Deron's current crash. Since I can freely focus on some topics that I am interested in, such as how is Delong's industrial and financial blueprint deployed?External or internal factors led to Deron's collapse?Where did Deron's money go?Who are Deron's core team?What is Delong's method of manipulating securities?

In the end, I decided to start with the simplest doubt, which floor and corner of the Delong Pyramid began to collapse? So, I rummaged through boxes and boxes to find out a copy of Delong's internal address book left during the interview that year. Starting from the damaged three-page paper, I started my two-year follow-up of Delong. Since this was the only lead I had, I had to do the worst thing I could - calling everyone on the list in turn. I remember that I called at least fifty or sixty people at that time, and I was mentally prepared to be rudely rejected beforehand.But beyond my expectation, these mysterious people in the eyes of the media are full of desire to talk. In hindsight, maybe one is because the public is quick to chase after new corporate stars, and suddenly they would want someone to pay attention to them when they suddenly leave the spotlight; This is what I wrote later: To the outside world, the rumored "demonized" Delong is an "illusion", and they cannot see the international and standardized side of Delong; but for the professional managers in the strategy of Delong International and Youlian In terms of internationalization, Delong's internationalization is another kind of "illusion", because they can't control the operating platform outside the two. Because of such a relatively objective understanding, there were at least 20 or 30 people who had in-depth exchanges with me on the phone at that time, and more than a dozen people later agreed to meet with me under my repeated harassment.There are several to ten hours of recordings of the conversations with everyone, which I have kept to this day. Most of these people left Deron in the later period. After entering the reorganization period, Deron's core team shrank to 11 people, and then only 5 people remained.For two years these key figures, all of whom had never been seen in the media, I followed closely and through them I reached out to many parties who were completely cut off from the outside world.For two years, I saw one or two of them almost every week. For example, one of the characters only occasionally appeared in the bar opened by his friend in the middle of the night, and I became a frequent visitor there. However, the more material you have at the beginning, the more painful it is, because this is really a blind man's process.In the face of the overly complex Deron, many people's narratives seem to me to be contradictory, although they are not lying.Of course, this at least made me aware of Delong's three-dimensionality, and I was interested in continuing to study it. In the process of this complicated pyramid structure, I repeatedly sorted out Deron's complex pyramid structure, and the conclusion presented in "The Captor" is as follows: This point can be seen from the pyramid-like functional structure of the Delong Building. The 1st floor is the reception hall and general staff offices, the 2nd and 3rd floors are the various departments of Delong International and Youlian Center, the 4th floor is reserved for general managers and executive presidents of some departments, and the 5th floor is for Wanli and Wanli Brothers. The entire executive committee, that is, the top management - but please note that there is also a 6th floor, which is the most secret place of Delong. This exactly corresponds to a pyramid-shaped governance model established by DeLong in the past 18 years: The Tang brothers and several core natural person shareholders are at the top of the tower; the next level is the executive committee at both ends of the industry and finance, most of which are entrepreneurial veterans and shareholders; the next level is the strategic management center of Delong International and Youlian , a group of professional managers are concentrated; under them, they correspond to various corporate entities and financial institutions. Among them, Delong International and Youlian Center, as the name suggests, are two strategic management platforms. They respectively carry out strategic design and process control for the development of various industries and financial institutions under the Delong system. According to Delong's system, those masters of mergers and acquisitions integration at the top of the pyramid will keep a distance from the industrial operation once the acquisition is completed. The firewall in the middle is the professional manager team in Delong International and Youlian Center.But in reality, those corporate entities and financial institutions at the bottom of the pyramid can often smoothly bypass the middle line of defense and communicate directly with the Tang Brothers.In particular, the capital pipeline is completely free from the two strategic management platforms that serve as firewalls.Vertical network management is a powerful lever for the top layer of the pyramid to directly mobilize funds from the bottom layer. This shows that, in addition to the strategic management system, Delong also has an operating system linked by funds and contacts-that is, a mysterious department located on the 6th floor of the Delong Building, whose core is a "funding five-member team: Tang Wanxin, Tang Wanchuan, Yang Li (big cashier), Zhang Yeguang (chairman of Deheng Securities), Wang Hong (chairman and president of Jinxin Trust)". In my opinion, only in this structure can we find the answer to Delong's three key words—industrial integration, financial mix, and integration of industry and finance.The incomplete understanding of this structure is the reason why other Delong analysis articles always give people the feeling of "scratching". Therefore, the first two chapters of "The Captor" are the first part of the whole book, namely the prequel. They revolve around this structure and focus on explaining how Delong's conception of industry, finance, and the combination of the two changed from a dragon to a flea. .These three key words are not only Delong's, but also the key propositions for Chinese enterprises to grow bigger and stronger in the next step. If only here, "The Captor" could be published about a year and a half earlier.But later, I developed a fourth theme on Delong - market-oriented restructuring.On this brand new proposition, Delong once again played the role of a pioneer of private enterprises - I decided to continue to observe. When the perspective shifted from Deron himself to Deron's reorganization, I found the complete chain of "The Captor", not only how to capture, but also how to be captured. This is really a magnificent and tragic picture: The sudden downfall of this group of people has brought a series of technical and moral dilemmas. How should they be sentenced and convicted, and should their companies also be judged?Should they be pardoned because of the staged institutional defects of the whole society, or should they be severely punished as a stepping stone for institutional change? While the people are still thinking, the new captors are already in action. As a result, we saw exactly the same picture—the capital chain of private enterprises collapsed, banks collectively forced debts, local governments forced to take over, entrepreneurs rushed out, and the painstakingly integrated industrial groups were split and distributed by various interest groups... Once a crisis occurs in private enterprises, they can only wait passively until the situation gets out of control and the government forces them to take action without a smooth transition mechanism in between. This also constitutes the biggest difference between "The Captor" and other Delong books of all kinds - "The Captor" is a record, not an analysis; It was a group of captors, not one. Of course, all this still needs to be based on a relatively accurate description of Deron in the past.Therefore, "The Captor" actually has two main lines. The bright line is the experience of Delong in the last 600 days, that is, the process of Delong's "death"; the process of. The connection between the two is that they together constitute the entire context of a Chinese super-large private enterprise from birth to death, as well as the logic behind it.In the end, I found that no matter the sudden wealth of the past or the fiasco of today, the external core reasons for their life and death are actually the same—China’s unruly financial and industrial environment.