Eight years ago, the first 56 employees of Xiaomi Corp collected $11 million to invest in the startup for selling their first smartphone. In this way, the employees gave up the savings and borrowed from their parents to start the business. Currently, these 56 employees are the most famous smartphone manufacturers and they are still working to make the company grow. In this sense, with the Xiaomi IPO between $1 billion and $3 billion, depending on sales, they could be millionaires.
Xiaomi: A successful company thanks to the effort and hope of any worker
This decision that started with employees like Li Weixing (ex-former engineer of Microsoft Corp), number 12 employee, produced the great success they have now. Recall that, in 2010, employees worked seven days a week to have a cell phone of unknown brand. After this, the people started to talk about Lei Jun and his partners were using their own money to finance Xiaomi. So, Li did not hesitate to join them. In this way, Li helped to create Xiaomi’s mobile operating system (MIUI). And guess what? His help saved around 500,000 yuan or the equivalent of $79,000.
The truth is that many of Xiaomi’s employees at the beginning already had large incomes among them. Lei, who achieve a large sum of money developing the leading software in Kingsoft Corp, allowed him to invest in new companies. Unlike many employees who had to raise money to participate in the project. At this point, Li and other employees decided to invest in an effort that they already knew, but that was uncertain. Currently, Li hopes to earn from $ 10 million to $ 20 million, depending on the value of Xiaomi’s IPO.
Another example is the employee number 14, who was the receptionist and currently works in the human resources office of Xiaomi. She in turn contributed around 100,000 to 200,000 yuan, the equivalent of $ 16,000 to $ 31,000. A share that can now be worth between $ 1 million and $ 8 million.
Xiaomi IPO: Lei Jun controls employee investment
Based on this and after the increase in the investment rate of employees, Lei decided to restrict investments to around 300,000 yuan in order to avoid the risk of loss. Since it considers that it would be a serious fault if the company failed to meet expectations.
In general terms, it is known that collectively Xiaomi employees earn up to $3 billion with 15% of the shares and a company valuation of $ 100 billion. Now, when the offer gets made public, the figures could be over $1.4 billion for this 56 investors. In this case with 25% of the shares and a $ 50 billion valuation of the company. Which means that employees could get up to 200 times more than their initial investment. This seems like a very attractive figure, right?
However, not everything is taken by employees. That’s right because Lei and his co-founders contributed the highest amounts that stand out more than the average. What consequently turns 5 of Xiaomi’s leaders into newly minted billionaires. Bloomberg has calculated that, after Lei Jun’s participation in several rounds of investment, he could get up to $ 27 billion.
Nonetheless, big investors like Qiming Venture Capital, Morningside Group, and others are expected to make huge profits from Xiaomi’s IPO. Also, this initial public offering of Xiaomi in Hong Kong could be the largest quote since the 2014 IPO of the Alibaba Group.
Photos via Mi Facebook.
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