The Money Tree Meeting
Ten minutes into the Money Tree Meeting, Lee Yong-kwon finally understood the awkward feeling that had been nagging at him. Embarrassment. It was like inviting a child you desperately wanted to impress—someone you hoped would like you and think well of you—only to discover they had already prepared a far better gift than the one you brought.
Yoo Jae-won was that child who already had everything.
When he first heard that the boy had started a company, Lee Yong-kwon had scoffed. Yet the moment Jae-won presented the business registration certificate from the tax office, the shareholder registry, and proof of substantial capital, it became clear this was a real company. Lee Yong-kwon had assumed Jae-won would arrive with a schoolteacher in tow, just like last time. Instead, he brought a genuine lawyer. The shock was so great that Lee Yong-kwon even checked the lawyer’s credentials against the Judicial Research and Training Institute’s graduate list to make sure it wasn’t some staged performance. Choi Kang-wook’s name was indeed listed among the seventh class graduates. Though he hadn’t graduated at the top of his class, the fact that he had been appointed as a judge confirmed his excellent academic standing.
The final blow to Lee Yong-kwon’s pride came during the typing tutor demonstration.
“Ah, a laptop. That’s a problem. The recommended specifications for Keyboard Warrior 1.0 require an AT-class machine with a VGA card. It will run on a laptop, but you’ll need a proper monitor to see it properly.”
Yoo Jae-won had said this while looking at the brand-new computer prepared for the demonstration. The laptop was Sambo Computer’s latest model—only seven kilograms, equipped with a hard disk and an Intel 386SX CPU. Its only real drawback was the monochrome LCD screen, the same type used in handheld game consoles, with large pixels and noticeable afterimages. It was a cutting-edge product that had received positive market feedback, yet to Jae-won it looked like nothing more than a slightly updated copy of the 1987 IBM Portable AT. The reaction Lee Yong-kwon had hoped for never came.
In the end, they decided to use the computer on the chairman’s desk. When Jae-won began unpacking the installation diskettes, Lee Yong-kwon had no choice but to admit defeat.
Impressive. Truly impressive.
The installation diskettes came from Lawyer Choi’s briefcase—or rather, from the package inside it. Sambo Computer had released several packages of its own, but this one was on another level from the very first impression. The words “Typing Tutor” were printed in a clean Gothic font, while “Keyboard Warrior 1.0” appeared in an elegant English typeface. The rectangular paper package featured a stylish arrangement of Hangul and English characters as its background, printed on expensive glossy coated paper that gleamed under the light. The finishing touch was the gold foil sticker: “Third Computer High School Competition – Ministry of Communications Minister’s Award,” rendered in shining gold.
“Whoa.”
At the strange exclamation that escaped Vice President Lee Yong-kwon’s mouth, Yoo Jae-won smiled faintly.
Ever since founding his company, Jae-won had worked without rest. That work had been the package design. He couldn’t simply hand over a bare diskette if he wanted to sell it. To command a high price, he needed to offer not only utility but also a touch of vanity. Jae-won found the answer in the packaging. He designed it so that even when placed on a bookshelf or display cabinet, it would look like a luxurious decorative item. He worked on it after school, and because his home computer wasn’t sufficient, he traveled to a professional system in the city. He was lucky—Yeoju had just opened an advertising shop that handled signboards, flyers, stickers, and newspaper ads. Seeing the words “Computer Design” in the corner of the sign, he walked in and found a Macintosh II sitting right there.
The machine had been released by Apple the previous year. Since it was designed after Steve Jobs had been ousted, it carried none of his influence, but for graphic work it offered performance on an entirely different level from IBM-compatible PCs. Jae-won immediately placed an order, but the shop’s designer lacked skill. In the end, he offered to pay a usage fee and asked to use the Macintosh himself. The shop owner, recognizing Jae-won’s reputation and tempted by the money, allowed him to operate the expensive machine. Naturally, Jae-won handled the Macintosh with effortless proficiency. The owner’s jaw dropped when he saw how skillfully Jae-won used QuarkXPress 1—a professional program for handling printed materials—far better than he could. Moreover, the design drafts Jae-won produced at lightning speed carried a modern sensibility the owner had never seen before. Eventually the owner found himself glued to Jae-won’s side, learning from him.
The advertising shop also had a color printer. All the work—package design, editing and printing the manual created with Jewel Writing, and producing the prototype—could be completed in one place. There had been a minor misunderstanding when using the color printer. The owner had assumed Jae-won was ordering one sheet at a time, mistaking the industrial printer for an ordinary printer. The machine required a minimum amount of ink per run, enough for roughly three hundred packages. Whether one printed a single copy or three hundred, the cost was nearly the same.
“Three hundred at once? Then please run it five times.”
The owner had thought raising the price would discourage him, but he had misjudged Yoo Jae-won. Jae-won ordered not only the package boxes but also the cardboard inserts, the same quantity of manuals, and even the sticker labels for the diskettes—all at once. He paid the deposit in cash on the spot. The owner, seeing the money, swallowed the words “Don’t joke around” that had risen to his throat. In that moment, Yoo Jae-won became the customer who had generated the highest sales for an advertising shop that had been open less than a month.
Though the package had been created in a rush, the finished product was in a completely different class from anything currently on the market. The glossy coated paper case alone was special. Opening the package revealed a sturdy cardboard box. Pulling that out exposed a twenty-four-page manual, with the program diskette securely fixed to a thick sheet at the very back—designed to prevent damage even if the package was handled roughly. The added components raised the per-unit assembly cost, but mass production brought the price down to around one thousand won per package. Adding the cost of blank diskettes and labor, the total production cost per complete package came to 2,500 won.
A 2,500-won package looked distinctly different even to Chairman Lee Yong-tae’s eyes.
But was it only the exterior that was impressive? Naturally, the shock delivered by the packaging carried over seamlessly into the program itself.
“Whoa!”
The moment the demonstration began on the computer, an even more intense reaction erupted. The level of completion in Keyboard Warrior 1.0 far exceeded what the Lee brothers had imagined. Sambo Computer had assembled its own elite development team to create a typing tutor, yet there was no comparison. Originally, Lee Yong-kwon had planned to show Jae-won the program their developers were making and advise him that this was the minimum standard needed to enter the market. Now? It seemed their developers would need to study Jae-won’s work instead.
“I thought the rumors were exaggerated,” Chairman Lee Yong-tae said calmly, his dignified demeanor unchanged. “But seeing it in person, it wasn’t exaggerated at all. They didn’t even do it justice.”
It was an extremely positive reaction.
“When such a talented young man with this level of skill wants to accomplish something great, there’s no reason not to help. Besides, the product has more than enough competitiveness to succeed in the market. This will benefit us as well.”
“Thank you, Chairman!”
The clear intent to purchase lifted the greatest burden from Yoo Jae-won’s shoulders. He bowed his head in gratitude. But the chairman’s words were not finished.
“However, with the year-end approaching, our available funds are limited. That’s a shame. Of course, this won’t be our only transaction, so don’t be disappointed. What matters is the price.”
“You’re absolutely right.”
It was obvious advice, but coming from a man who had built a company with ten million won in capital into one generating 120 billion won in annual revenue, the confidence was understandable. Sensing that the chairman wanted to offer more guidance, Jae-won listened quietly.
“We need to secure the maximum quantity within our budget, while you’ll naturally want to maximize your profit. So let’s find a price that satisfies both sides.”
The chairman’s words were basic, yet they still implied he underestimated Jae-won’s capabilities. Price was determined by far more than quantity alone. Jae-won knew countless ways to sell at a high price while still delivering great satisfaction to the buyer. Taking a short breath, he began his sales pitch.
“Yes, price is important. That’s why ID Technology has established various policies to ensure both consumers and vendors can enjoy full satisfaction.”
Product prices were not fixed. There were factory prices, volume discounts—these were common sense now.
“We’ve set the retail price of the typing tutor at a minimum of 30,000 won per copy.”
At the mention of 30,000 won, Chairman Lee Yong-tae and the other Sambo Computer executives nodded. It seemed reasonable. After all, the operating system essential for running a computer—MS Hangul DOS 3.3—was supplied to Sambo at 79,000 won per package, with a consumer price of 100,000 won. Even with a bulk discount of 21,000 won, the comparison held. Their localized word processor, Jewel Writing, was priced at 59,000 won. Against these benchmarks, 30,000 won felt appropriate.
But Jae-won’s explanation was not over.
“30,000 won is the price for the personal version. The school version is 40,000 won, the academy version is 50,000 won, and there’s also an enterprise bundle option.”
He had differentiated pricing according to the nature of the buyer rather than treating all consumers the same. The names were intuitive enough to guess the reasoning, but the details weren’t entirely clear. Chairman Lee Yong-tae waited for further explanation.
“Purchasing the program means buying a license. Usually there’s no time limit on the license, but depending on the situation, limited-term licenses could be offered. In any case, one license per person is the basic model. However—”
“Schools and academies would install one package on a computer and have multiple users take turns.”
As someone in the computer business, the chairman understood immediately.
“Yes. That’s why we made the distinction. Besides, schools use it for education, which is acceptable, but academies are profit-driven businesses. That’s why we set the highest price at 50,000 won.”
“Right. They can’t be treated the same.”
“Additionally, we’ve added some extra features to the program. The school and academy versions include network functionality via LAN.”
“Huh? Network?”
A sharp-looking employee who had been listening quietly exclaimed in surprise at the mention of LAN, then quickly lowered his head under the chairman’s gaze. Vice President Lee Yong-kwon also looked taken aback. It was understandable—using LAN cards to connect multiple computers was still cutting-edge technology in the current computer industry. Even at Sambo Computer, only a small research lab was exploring it.
“The administrator version of the typing tutor can control student versions connected via the network. It can send signals for short-text practice to all students at once, or have them type sentences entered by the teacher. It also allows monitoring students’ learning levels on a single screen and managing them individually. Students and teachers can even exchange short messages like notes.”
The Lee brothers’ mouths fell open at the rapid-fire list of features. They would have been even more shocked to learn that the administrator version existed only in Jae-won’s mind for now—not because he lacked ability, but because he lacked the development tools. Creating network connectivity with GW-BASIC was impossible even for him. A powerful language like C was required, and it wasn’t available in the countryside. Since he was in Seoul today, he planned to acquire C and build the administrator version as soon as he returned home.
“With these additional features, consumers will understand the value. Once they try it, they’ll see these functions are worth far more than the price.”
Jae-won’s voice remained perfectly natural—he knew a week of all-night work would be enough to complete it.
“I see. But will Sambo Computer be able to handle the enterprise version? And you still haven’t mentioned the price.”
“We can’t sell to our best customers like large corporations the same way we sell personal packages. We’ll determine the maximum discount based on how they intend to use it and the quantity. For example, if it’s pre-installed as a bundle on computers, we’ll offer a 10% discount from the personal price. This applies only to the diskette and manual, not the full package. Additionally, for purchases of 1,000 copies or more, we’ll provide a further 20% discount. That’s a total of 30%, bringing the price to 21,000 won per copy.”
It was a discount of nearly 10,000 won. Even executives accustomed to handling hundreds of millions of won couldn’t help but be tempted. Buying just 1,000 copies meant a 9 million won discount.
“If you’re willing to be so considerate, we can’t fail to show our sincerity either. We’ll order 2,000 copies for the bundle version. We’ll also purchase 300 copies of the full package. Furthermore, we’ll include the typing tutor as standard on the home and educational computers launching next year.”
He was indeed generous. Yoo Jae-won knew the exact size of next year’s home computer market: 10,000 units per month, 120,000 per year. The number seemed small compared to 1997, when over a million units sold, but computers were at least three times more expensive now. Adjusted for inflation, it was clearly a lucrative market. Sambo Computer held roughly 20% market share, meaning at least 24,000 copies were guaranteed. A simple calculation showed 550 million won in revenue from this single meeting. Given the software industry’s near-zero production costs, at least 80% of that would be pure profit. Then the profit would be distributed according to shareholding ratios, reducing the amount that reached Jae-won’s pocket—but it would still be well over 100 million won.
“There is one condition, however. The Keyboard Warrior series must be supplied exclusively to Sambo Computer.”
The terms were generous, but they wanted exclusivity. Vice President Lee Yong-kwon nodded as if it were only natural. Even Choi Kang-wook, seated beside Jae-won, wore a positive expression, apparently thinking it a good deal.
This old man really doesn’t give anything away easily. So the choice had to be made now.
“Exclusivity? I’m afraid that will be difficult.”
Yoo Jae-won refused without a moment’s hesitation.