A Wall Street Genius's Final Investment Playbook-Chapter 327 : The 100-Billion Race (23)

The contents of the footnote seemed, at first glance, perfectly harmless.

“Community-adjusted EBITDA” is a proprietary metric developed to clearly evaluate WeHub’s community-centered business model.

This metric excludes one-time expenses related to future-oriented investments such as activating networking among members, creating creative collaboration spaces, and building a global community platform.

—It reflects our management philosophy that prioritizes long-term brand value and the construction of a sustainable innovation ecosystem over short-term profits.

“Community” was the very core value that WeHub promoted.

They defined themselves not as a mere “shared office,” but as a “global network of innovators.”

— Innovation in the 21st century is not created by a single genius, but arises from moments when exceptional talents meet by chance and collaborate...

This was their philosophy.

The “community investments” Masayoshi had imagined were clear. 𝕗𝐫𝚎𝗲𝘄𝐞𝕓𝐧𝕠𝘃𝕖𝐥.𝐜𝚘𝚖

Cutting-edge technologies such as AI-based networking systems, real-time global collaboration platforms, and big data–powered member-matching algorithms.

Such sound investments were bound to return as even greater profits.

However, Ha Si-heon had called this a landmine.

‘What on earth did he see here?’

Masayoshi looked closer at the footnote.

But nowhere was there any detailed breakdown of the “community investments.”

Instead, there was only a signpost pointing him toward the next destination.

(For details, refer to Footnote 17: “Definition of Community Activation Costs.”)

Thus he arrived at Footnote 17.

But there was no substance there either.

—“Community activation costs” are strategic expenditures executed to build our global innovation ecosystem, with the goal of generating synergies among members and enhancing brand value.

(For detailed breakdown, see Appendix D-4: “Cost Classification Table.”)

What followed was an endless parade of references.

Appendix D-4 pointed to Appendix E-2, and E-2 led further to Supplemental Document S-11.

‘What is this, a Russian nesting doll…?’

As he grumbled, an uneasy feeling quietly began to rise.

The deeper the maze of paperwork went, the more it seemed someone was intentionally hiding something, and the more he could not shake off a gnawing sense of dread.

And then, when he finally reached “Appendix Z-10: Status of Major Contracted Vendors and Expenditure Records,” Masayoshi instinctively knew.

This was the answer he had been looking for.

At a glance, it was just a dry table.

But unlike the flowery rhetoric before, this section was filled with actual, concrete traces of where money had gone.

Vendor names, purposes, and exact amounts.

Vendor: Metropolitan Realty Group

Category: Community Infrastructure Development

Amount: 875 million dollars

Vendor: HR Staffing Solutions

Category: Community Operations Personnel

Amount: 32.85 million dollars

Vendor: Blue Ocean Coffee Supply

Category: Community Networking Activation

Amount: 9.25 million dollars

Masayoshi’s eyes stopped at the final entry.

‘Blue Ocean Coffee Supply?’

For something supposedly spent under the lofty purpose of “community networking activation,” the name sounded… far too ordinary.

With a sinking feeling, he searched it on his phone.

As expected, it was just a regular coffee bean supplier.

‘They categorized spending on coffee beans as… networking activation costs?’

Technically, if one tried very hard, it wasn’t entirely impossible to justify.

People drinking coffee in the cafeteria might naturally start conversations, which could lead to collaboration.

However, this was a far cry from the advanced technologies he had envisioned, such as “AI-based matching platforms” or “big data analytics systems.”

More importantly…

There was a fatal problem.

‘This is just regular operating expense!’

“Adjusted EBITDA” represents figures excluding strategic investments made for the future.

Like how NetPlus spends massive budgets on original content—costs now, but future assets.

However…

‘They categorized coffee beans as a strategic investment for the future?’

That was utterly absurd.

It was no different than a restaurant claiming the cost of buying salt was an “R&D investment for future culinary innovation!”

‘Could it be... the other items too…?’

Seized by a terrible premonition, Masayoshi began to search for the remaining vendors one by one.

Not long after, his face turned pale.

“This is insane…!”

HR Staffing Solutions.

He had assumed it was some advanced talent management system, but it was simply a staffing agency that sent front-desk receptionists.

They had packaged receptionist salaries as “investments in community manager development.”

Even more shocking was Metropolitan Realty Group.

They were the landlords of the buildings WeHub was renting.

In other words, the 875 million dollars WeHub had paid them was not “investment for innovation,” but simply normal rent and security deposits.

They had essentially disguised ordinary rental expenses—as strategic investments!

No wonder “adjusted EBITDA” was showing a surplus.

They had excluded the biggest cost in real estate leasing: rent!

‘These con artists…!’

However, strictly speaking, it wasn’t fraud.

They had never actually lied.

They had, in fact, itemized all costs in the documents.

They had merely buried them under dozens of layers of footnotes, disguising them with flowery language.

At that moment, another one of Ha Si-heon’s remarks flashed through Masayoshi’s mind.

— Oh, and while you’re at it, you might also want to check the “trademarks.”

The sense of unease rose even higher, and Masayoshi returned to the stack of documents.

This time, he spent a long while wandering another maze to find the sections related to “trademarks.”

An hour and a half later, he finally located the relevant language.

—The “WeHub” and related “We” brands used by our company are intellectual property owned by “Weer Holdings,” and are used under an exclusive license agreement. As of 2016, we pay an annual brand royalty of 5.9 million dollars.

It was a section he had skimmed over before.

Companies paying brand royalties is common.

But looking at it again now, it felt wrong.

Isn’t “We” just a generic word?

Paying 5.9 million dollars a year to use a word that’s practically a common noun…

Digging deeper into the footnotes with growing suspicion, he uncovered a shocking truth.

—Weer Holdings is a corporation personally owned by our CEO and cofounder. The license terms were priced at fair value through an independent third-party appraisal.

“You’ve got to be out of your mind…!”

The curse burst out of Masayoshi’s mouth.

Because this meant…

…that the CEO was getting paid separately for his own company’s “name value!”

It defied common sense.

For a founder, a company is like one’s own child.

And investors are the generous sponsors who willingly provide the child’s upbringing funds for its future.

So what had just happened?

The so-called father was effectively sending a bill to those benefactors, saying, “I named the kid, so if you want to use that name, pay a fee.”

His head spun even more.

“If it’s like this with the name…”

There could easily be bigger wrongdoing he didn’t know about, and it wouldn’t be surprising.

If someone would even skim off the company’s name value, what wouldn’t they do?

The problem was…

He had already publicly praised this place as “an icon of 21st-century innovation.”

A chill ran down Masayoshi’s back.

“If this gets out…”

The reputation he had built over a lifetime would collapse overnight.

If it came to light that he had been duped by such a childish numbers game, the name Masayoshi would become, quite literally, Wall Street’s clown.

The funds pledged to the Visionary Fund would ebb away like the tide.

People would say, “How can someone who couldn’t even spot this kiddie bookkeeping be trusted to manage a hundred billion dollars?”

But that was absolutely unacceptable.

His ambitious project to crown Act Two of his life could not be allowed to run aground before it even began.

“That—at least…”

That, at least, had to be prevented at all costs.

Then how?

“So that’s why he was so relaxed…”

If he wanted to stop Ha Si-heon from detonating this bomb, he would have to accept the man’s demands.

But what Ha Si-heon wanted was essentially the steering wheel of the Visionary Fund.

Accepting that was out of the question.

Yet at this rate, the Visionary Fund would run aground anyway.

…

“Stay calm.”

Masayoshi took a deep breath and steadied himself.

He still had a card to play.

To complete the “reconciliation” picture Saudi wanted, his consent was indispensable.

His fingers trembled, but he kept his composure and dialed Ha Si-heon’s number.

“I just confirmed the WeHub matter.”

[You called sooner than I expected.]

“As you said, there is a problem. But it’s not quite enough to pressure me, is it? You know Saudi’s ‘reconciliation’ can’t happen without my cooperation.”

He was trying to seize the initiative in the negotiation.

If he accepted Ha Si-heon’s terms as-is, the Visionary Fund risked becoming Ha Si-heon’s colony.

“A veto right on investments is overkill. Consider a different form of cooperation.”

But what came through the receiver was a relaxed laugh.

[You make it sound like I’m threatening you. I’m sincerely trying to help.]

“How on earth is this ‘help’?”

[Hear me out first. This won’t be solved by hiding it. In fact, you should expose it first.]

“What? What nonsense—”

[But you’re the one who does it.]

Masayoshi couldn’t believe his ears.

Dig my own grave?

What kind of insane advice was that?

But Ha Si-heon went on calmly.

[You told me before, didn’t you, that no sane man uses the eye of a typhoon as his umbrella?]

Indeed, Masayoshi had used that metaphor earlier when explaining why he wanted to keep his distance from Ha Si-heon.

A calamity like you should be isolated far away, not kept nearby.

But what did that have to do with the current situation?

Ha Si-heon continued with a smile.

[On a clear day, you’d be right. But if a typhoon covers everything in all directions? Then everyone flocks to the eye—the only safe zone—don’t they?]

“…!”

Masayoshi’s eyes flashed.

At last, he could see the picture Ha Si-heon was painting.

[I’ll exercise veto rights only over the Visionary Fund. In other words, everything else becomes your kingdom.]

“......”

[Well? Even so, will you still refuse to work with me?]

It wasn’t ideal.

But the alternative was worse.

In the end, he made up his mind.

“I accept.”

***

Some time later, Masayoshi Son held a press conference.

“The reason I called this gathering today is to address the recent controversy regarding my conflict with CEO Ha Si-heon. As many of you know, I have long been in sharp opposition to CEO Ha Si-heon over investment philosophy in the tech sector. However, through the mediation of the Saudi royal family not long ago, I had the opportunity to speak with him candidly and in depth, and I was compelled to take a hard, honest look again at the issue he raised—‘moral hazard in the tech sector.’”

Masayoshi paused and drew a breath.

His expression darkened.

“And then I… came face-to-face with a shocking truth. A company I personally invested in and publicly championed as a symbol of 21st-century innovation was, in fact, sitting at the very center of that moral hazard. That company is WeHub.”

He then calmly listed WeHub’s many outrageous acts of moral hazard.

He presented what he had confirmed directly from the documents, along with additional information obtained from Ha Si-heon.

“The WeHub CEO routed investor funds into his personal accounts by subleasing buildings he personally owned back to WeHub at prices far above market rates. Furthermore, a look into the line items under ‘productivity enhancement’ spending revealed not only beer and premium wine service, but VIP music festival tickets to ‘boost morale’ for all staff, and even a private sauna and ice plunge installed in the CEO’s personal office.”

“In the name of employee welfare, the company spent millions providing luxury hoodies emblazoned with the WeHub logo and dog-only yoga mats and premium treats for employees’ pets.”

“They also hired large numbers of the CEO’s acquaintances and family members, continuously creating positions with effectively unclear duties.

For example, the CEO’s wife received an enormous salary as the company’s ‘Chief Spiritual Culture Officer,’ and there were other bizarre titles whose functions were impossible to discern, such as ‘Chief Happiness Officer,’ ‘Chief Evangelist Officer,’ even a ‘VP of Enlightenment’ and a ‘Chief Wellness Officer.’”

Masayoshi’s revelations sounded almost too unbelievable.

When the lid was lifted on Silicon Valley’s brightest hopeful, what came out wasn’t innovation but third-rate comedy.

And yet, the real show had only just begun.