The Conglomerate Family Became A Villain [EN]: Chapter 194

194. The Swelling World (3)

By the end of 1985, the German Mark and Japanese Yen had surged by about 20%, shaking the foreign exchange market.

Forex dealers frowned daily, their voices rising in the trading rooms.

“I don’t know how long it will keep rising.”

“Wouldn’t it be better to bet on the rise?”

“We are not gamblers.”

“That’s true.”

It wasn’t just forex dealers lamenting the market’s uncertainty.

The same went for fund managers and traders at securities firms and investment banks.

“I think it would be good to just avoid losses this year.”

“Everyone’s just complaining.”

“Who knew the Reagan administration would make such a deal?”

“I know, right? I thought they’d just lower tariffs.”

After the Plaza Accord [an agreement in 1985 to depreciate the U.S. dollar in relation to the Japanese yen and German Mark], the profitability of American securities firms deteriorated, and the Japanese delegation replaced victory reports with interviews claiming they had brought America to its knees.

At this time, the Plaza Accord had not yet fully taken effect.

December 21st.

Victoria Corporation Headquarters.

Chung Hyun-woo held the last executive meeting of the year.

“Is everyone here?”

Ann, who became CFO this year, answered his question.

“Everyone is present except for Mac.”

Mac Coyle was leading the AS [After-Sales] business division in New York. He was unable to attend today’s meeting due to a sudden power outage in the Brooklyn area.

“Good. Then, let’s begin the meeting.”

The year-end meeting usually focused on the performance and results presentations of each business division.

However, Victoria Corporation’s year-end meeting was a bit different.

Chung Hyun-woo prioritized plans for 1986, the coming year, over performance and results presentations.

“John, what are the plans for next year?”

The John that Chung Hyun-woo pointed to was John River of the game business division, not John Pier.

“We have plans for 3 new games and 6 ports next year.”

“Which platform are you porting to?”

“NES.”

NES was the North American name for Nintendo’s Famicom [Family Computer]. Throughout 1985, the NES caused a sensation, leading the North American game market.

“NES, huh? Won’t this Plaza Accord affect it?”

In just two months, the Yen had risen by nearly 20%. This meant that the price of the NES had also risen by nearly 20% in two months.

John River answered Chung Hyun-woo’s question.

“The US subsidiary and importers are bearing some of the costs, so the consumer price hasn’t risen that much.”

“You mean you’re willing to reduce profit margins to sell more units.”

“Nintendo seems to think this is just the beginning.”

Chung Hyun-woo knew the future where the NES would completely dominate the North American market.

‘Nintendo’s judgment was correct.’

The NES was expected to sell over 30 million units in North America alone.

This surpassed the sales of the Atari 2600, which had triggered the Atari shock [a major downturn in the video game industry in 1983].

“Tell them that we share the same sentiment as Nintendo.”

John River hesitated and asked.

“Are you saying we can be more aggressive?”

Chung Hyun-woo nodded and replied.

“Do it.”

Ann, who had been listening to his conversation with John River, carefully raised her right hand.

“Charlie.”

Chung Hyun-woo turned his gaze to her and said.

“Ann, speak.”

Ann nodded after he granted her permission to speak and shared her thoughts.

“We have started too many businesses this year, and if we don’t manage the risks, we may face a financially dangerous situation.”

As CFO, she wanted to point out that Victoria Corporation’s expenses were rapidly increasing.

Serah had advised Chung Hyun-woo from the same perspective.

Of course, Chung Hyun-woo did not accept her advice. He had confidence in his success.

“Are you saying that the number of business divisions recording losses will increase?”

Ann shook her head and replied.

“That’s not it. However, AS technician wages have increased, and the data center construction has also begun, so there may be a temporary shortage of funds.”

Even if the wage increase for AS technicians was manageable, the data center was a money-eating hippopotamus that would not generate any revenue until it was completed.

“Ann, if you think we’re short on funds, tell me right away. I’ll take action.”

Ann nodded at Chung Hyun-woo’s instruction.

“Understood. I will report to you immediately if the available funds decrease.”

Chung Hyun-woo turned his gaze back to John River.

“John.”

“I’m listening.”

“Push forward with the collaboration with Nintendo aggressively.”

Chung Hyun-woo decided to aggressively support John River and the game business division.

‘Now that Super Mario has been released, there’s no need to doubt Nintendo.’

Super Mario was the top contributor that elevated Nintendo and the NES to the top spot worldwide.

“Let’s move on to the next topic.”

After John River’s game business division, it was Robert’s G-Shop.

“G-Shop generated $120 million in sales this year. Although it’s a small amount compared to JP Service, I think it’s a level that cannot be ignored.”

Chung Hyun-woo nodded after hearing Robert’s words.

“The growth… no, the recovery is clear.”

Robert said in a clear voice.

“The release of the NES and the growth of the computer game market seem to have helped.”

“How do you plan to operate G-Shop next year?”

Robert answered Chung Hyun-woo’s question.

“We plan to add about 100 more shops across the United States.”

“Directly managed?”

“Yes.”

Increasing the number of directly managed stores meant additional costs would be incurred.

Ann, the CFO, sighed inwardly after hearing Robert’s words.

‘Hoo… another place where money needs to be spent has increased.’

Serah was sitting to her right, and when she lowered her head, she gently reached out and grabbed her wrist.

“Don’t worry. Charlie’s here.”

“Pardon?”

“If we run out of money, Charlie will even use his own personal funds to solve it.”

Chung Hyun-woo would take all the responsibility.

Ann already knew this. But she thought she had to fulfill her duties as CFO.

“But, Serah.”

“Charlie has already finished calculating it in his head.”

Ann couldn’t help but nod at Serah’s comfort.

“I understand.”

While the two were talking in small voices, Robert’s report on G-Shop ended.

“How is Microsoft doing?”

As Serah became COO, collaboration with Microsoft also passed to Robert.

“They say they will release a new operating system in the second half of next year. We plan to release new versions of JP Service, American Service, and City Service accordingly.”

Chung Hyun-woo already knew what the new operating system Microsoft would release was.

‘It’s the early Windows.’

Of course, even if the Windows operating system was released, it could not immediately become mainstream.

The Windows operating system became mainstream after the mid-90s.

“I’ll trust Robert to handle the collaboration with Microsoft.”

Robert slightly lowered his head.

“I will do my best.”

Up to this point, there was nothing special.

The problem was from now on.

Chung Hyun-woo turned his gaze to Serah.

“Serah, let’s talk about the Victoria Fund.”

Chung Hyun-woo was most deeply involved in the Victoria Fund.

However, formally, the Victoria Fund was under Serah’s management.

Serah looked over the prepared materials and said.

“The Victoria Fund has completed the incorporation process in New York and has already raised approximately $2 billion in investment.”

Today was the first time that the $2 billion investment was specifically revealed to everyone.

Executives of Victoria Corporation, including Ann, couldn’t help but be surprised by the size of the investment.

“Is it really $2 billion?”

“The investment is larger than expected.”

“Is it okay to invest such a large amount from the beginning?”

Chung Hyun-woo said to everyone.

“The Victoria Fund is another future that Victoria Corporation is aiming for. I think expectation should take precedence over worry.”

As his words ended, Serah continued.

“John Pier, formerly of JP Morgan, will be in charge of managing the funds, and we also plan to establish a Japanese branch in January of next year.”

Establishing a Japanese branch.

This was also the first time they were hearing about this.

Robert sighed briefly and said.

“Hoo… Is Japan also the main investment target for the Victoria Fund?”

Serah nodded and replied.

“Because I think Japan is the country that has benefited the most from this Plaza Accord.”

“Don’t you think it’s a bubble?”

Serah shook her head and said.

“I don’t think it’s a bubble. Even if it is a bubble, that bubble won’t burst right now.”

This time, Ann asked her.

“Serah, how much of the $2 billion investment do we have to bear?”

She wanted to know the amount that Victoria Corporation had to bear.

“We’ll only invest about $500 million for now.”

“$500 million…”

“It will be a bit of a burden.”

Serah thought that since the Victoria Fund was under Victoria Corporation, it was inevitable to have a burden.

‘From the beginning, it’s a fund to increase Victoria Corporation’s money, not Charlie’s or my money.’

Chung Hyun-woo looked at Ann and said.

“Ann, the Victoria Fund is a company for Victoria Corporation.”

“I know, but the amount is too large…”

“The amount of funds managed by the Victoria Fund will increase further in the future.”

The initial investment of $2 billion was soon expected to grow to $3 billion.

Ann had no choice but to accept it when CEO Chung Hyun-woo said it so decisively.

“I understand. I will prepare accordingly.”

Serah talked about data center construction, security service development, and module service development in addition to the Victoria Fund.

Robert, Ann, and John River thought while listening to her story.

‘None of them are businesses that make money right now.’

To put it nicely, it was an investment for the future, and to put it badly, it was an unproductive activity.

‘If even one of them fails, it will cause considerable damage to the company.’

On the other hand, Chung Hyun-woo thought differently from them. He thought that if even one of them succeeded greatly, it would more than make up for the failures in other areas.

“1986 will be a year in which Victoria Corporation takes another leap forward. To do this, your strength is absolutely necessary.”

Victoria Corporation executives, including Robert, could only say that they would do their best.

After the executive meeting.

Serah met Chung Hyun-woo separately at a cafe outside the company.

“Charlie.”

Chung Hyun-woo shrugged and picked up a spoon.

“The atmosphere at today’s meeting wasn’t very good, was it?”

“Everyone doesn’t welcome the new businesses.”

“Do you think the same, Serah?”

Serah was in charge of various businesses on behalf of Chung Hyun-woo, but she did not agree with all of them.

“I told you last time. I believe in Charlie.”

She had shown a bold move by pouring more than 30% of her assets into the Victoria Fund that Chung Hyun-woo had conceived.

Chung Hyun-woo stirred his coffee and said.

“There’s no risk in things that everyone agrees with.”

Serah sighed briefly and took his words.

“If there’s no risk, the return is small?”

High risk, high return.

It was a story that business people told like a habit.

“Serah, if you could take out just one thing, what would you want to take out?”

Serah shook her head and replied.

“Don’t say things you don’t mean.”

“Is it something I don’t mean?”

“Charlie wants to do everything, right?”

Serah was the person who knew Chung Hyun-woo best in the world.

“I can’t lie to Serah.”

“Charlie, you have more things you want to do, right?”

Chung Hyun-woo put down the spoon and replied.

“No. Not right now.”

“Really?”

“Really. Right now, even just the Victoria Fund is giving me a headache.”

Serah nodded slowly.

“You even have to establish a Japanese branch, so that might be the case.”

Chung Hyun-woo slightly raised the end of his words.

“Serah, do you have any plans for the end of the year?”

Serah narrowed her eyes and asked back.

“Is something going on?”

“I’m just asking.”

“What plans would I have?”

Chung Hyun-woo smiled and said.

“Then, let’s go on a trip together.”

Serah tilted her head to the side after hearing Chung Hyun-woo’s words.

“A trip together? Where are you saying we should go?”

Chung Hyun-woo raised his right index finger and replied.

“Tokyo.”

Serah’s eyes widened for a moment.

“Tokyo?”

“We were going to go together before, weren’t we?”

Chung Hyun-woo and Serah had requested VIP tickets for a trip to Japan from Peter Lynch.

“Well, we did.”

“Do you not like it?”

Serah forced a smile and replied.

“No, I like it. Okay, let’s spend this year’s Happy New Year in Tokyo.”

She knew that this trip was not for enjoyment.

‘It must be a trip to establish the Tokyo branch of the Victoria Fund.’

Of course, that didn’t mean the excitement of the trip disappeared.

* * *

New York, Wall Street.

Big Head Kyle Montana of Morgan Stanley had his hands together and a somber expression on his face.

“Is this all there is?”

Jeremy Spin bowed his head deeply.

“The number of service subscribers has decreased compared to last month. I think the reduction of the business is inevitable.”

Morgan Future, the stock ticker service that Morgan Stanley had ambitiously opened, was struggling.

“Didn’t you say that hiring excellent programmers would solve everything?”

Jeremy Spin replied.

“It wasn’t my opinion.”

It was Louis Nolan, formerly of JP Morgan, who said that they should invest aggressively.

Kyle Montana asked in a sharp voice.

“So you’re saying you have no responsibility?”

Jeremy Spin answered his question calmly.

“I will quit if you tell me to.”

Kyle Montana’s eyebrows shot up at that moment.

“Jeremy!”

“Mr. Montana, raising your voice won’t help. Morgan Future has failed.”

Morgan Future was sinking with unstable service without becoming JP Service.

“What did you just say?”

Jeremy Spin looked at him without bowing his head and replied.

“Morgan Future has failed.”

The failure of Morgan Future.

This was also Kyle Montana’s failure.

“Je, Jeremy!”

“Mr. Montana, if independent service development was possible, City Bank or Bank of America would not have followed JP Morgan’s lead.”

Kyle Montana slammed the desk at Jeremy Spin’s sharp criticism.

Bang!

“Such loser-like remarks are what created the current failure.”

Jeremy Spin’s expression did not change.

“As the head of investment strategy, I would like to suggest to Mr. Montana that Morgan Future should be terminated by 1987.”

The losses of Morgan Future did not end with development costs alone. A service operation team and a large server were running for a small number of service subscribers.

‘Unless a dramatic reversal occurs, losses will accumulate every year.’

Kyle Montana pressed down on the desk with both hands and said.

“Jeremy, I’m disappointed in you.”

Jeremy Spin looked at Kyle Montana and raised the end of his words.

“What are you going to do?”

Kyle Montana glared at him and replied.

“You’re fired.”

Jeremy Spin nodded as if he knew it would happen.

“I understand.”

He seemed like someone who had been hoping to be fired.

“Jeremy.”

“Why?”

“Don’t you think you have any responsibility?”

Jeremy Spin turned around and answered his question.

“If I had any responsibility, it would be that I didn’t have the courage to submit my resignation until now.”

He thought he should have submitted his resignation sooner.

‘The fact that I held on until the end of the year must have been due to my greed.’

It was a fight that could not be won from the beginning.

Morgan Stanley was an investment bank, and Victoria Corporation was an IT company.

It was obvious which side’s software and system would be superior.