Qing Branch founder Gavin: National PE no longer VC increasingly hot

PE (Private Equity) industry and the excessive growth of the past three years, the Enterprise Board queuing company to guide the poor, raise funding difficulties, exit difficult to start bothering PE industry, integration, transformation, evolution into the industry's popular words.

Local PE leader jiuding investment in its 2013 annual report that "because a large number of private-equity institutions difficult to obtain the expected return on investment, there will be large numbers of institutions in the future to withdraw from the existing market, and thus accelerate the industry integration."

PE industry who can successfully evolve and survive in the fierce competition, testing the wisdom of each PE big guy.

Big PE Big Capital pipe

For a PE, the investment income of the project is the determining factor of its competitiveness and sustainable development ability.

At present, the main exit channel of domestic PE investment is still IPO. Lattice on financial management, private equity data show that 2009 to 3721.html ">2014 year October 15, pe/vc a total of 2425 exit incidents, of which through the IPO exit of up to 1723, accounted for 71%, followed by the acquisition of 391, accounting for more than 16% In addition, there were 185, 55 and 34 respectively through equity transfer, corporate repurchase and MBO withdrawal.

The PE industry plunged into the cold winter, the IPO from August 2012 to December 2013 suspended, so that the main channel of PE exit congestion, exit or extension, or find another way, or directly terminated. Sudden changes also make the hot PE industry cooling, and forced PE bosses to think about the transformation of the law.

Wangzen, managing director of Sequoia Capital China Fund, said in an interview with the 21st century economic reporter that future PE institutions will not be all-inclusive and will become more and more specialized. There are two forms of specialization. First, the PE institutions to set up a single, a specific field of funds, such as only investment in clean technology, only investment in consumption, or only to invest in TMT, or even more detailed areas of investment; second, the establishment of a more specialized group within the Fund, this is the trend. Wangzen explained in detail, for example, there are some mergers and acquisitions funds in the market, investment in large shares, or even directly as large shareholders.

East Coast Investment Partners, Executive Vice President Fan Hui that the current evolution of PE is mainly 3 forms. First, the large PE to the direction of the development of large capital, developing mezzanine funds, real estate funds, hedge funds, equity funds and other new business; second, small PE to VC transformation, more focused on the investment in the subdivision industry, the third is to go back, such as mergers and acquisitions, increase and other business.

To jiuding, Ding Hui and other representatives of the large-scale PE is going to the big capital pipe. October 20, Jiuding announced that the company to the days of the source of securities increased 364 million yuan to obtain its 51% equity, this is the first case of PE holding brokerages in China; this July, Jiuding invested 100 million yuan to set up nine Thai fund and was awarded, became the first public offering PE company. And Ding Hui is very early test water Mezzanine fund, creditor funds and other new business.

"It is an important strategic planning direction for jiuding investment to become a comprehensive financial service organization with equity investment as its core, to open up new asset management business areas and to meet the diversified investment needs of clients," said Jiuding, an executive. I believe that there will be more and more customers with a considerable base, management scale and good management performance of private equity management to enter the public offering market. This is also the development of PE institutions one of the trends. ”

Small PE towards VC

To the big capital pipe is a large PE game, small and medium-sized PE should be in the fierce competition to avoid when the elimination of the people?

"The first two years of highly asymmetric market information, small and medium-sized PE mainly by the enterprise IPO downwind car to make money, with the market information more and more transparent, riding the car's money-making model is not sustainable, compared with the large PE does not have capital advantages and increase the strength of service, small PE can only choose the In the initial stage of enterprise development investment, avoid the head-on confrontation with large PE. "Fan Hui said.

"This year has a clear feeling is that the national PE although no longer, but VC began to hot." Fan Hui said, on the one hand, a lot of PE turned to VC, on the other hand, the large development of public financing.

Last month, Qing Ke Group founder Gavin once told a VC hot hands-on experience. "A few days ago, my investment manager told me that there was a company that was particularly good and that the company would be 2 million yuan and 10% per cent." I said good, cast! But in the evening, the investment manager told me that a famous VC would have to invest 1.5 million dollars or 10% shares. That is to say, the same is 10% shares, their investment is more than four times times our. ”

Jiuding The above executives also said that the company has recently completed the establishment of a VC investment team, investment direction will focus on the TMT area of the Internet and mobile Internet-related industries. For example, O2O, online education, mobile medicine, online tourism, internet finance, hand tour, smart hardware, mobile power and services, and other fields, the investment phase to Prea and a round dominated.

Wangzen that the current VC heat is a variety of forces, conditions, environmental driven, there are 4 major reasons. "The first is the wealth effect of VC brought, whether it is listed or be merged, there are good returns on the books; second, the country from top to bottom are encouraging innovation, entrepreneurship, a new generation of information technology revolution such as micro-letter, micro-BO, are gradually integrated into the traditional industry, many traditional industries have not changed much, like a basin of stagnant water, But now information technology makes the traditional industry has a profound change, so that the differentiation and even remodeling, restructuring, entrepreneurial opportunities increased; third, there is no good investment channels in the market, such as real estate, coal, two-tier market, etc. are not good. Wangzen pointed out that the fourth important reason is that the maturity of the project is less and smaller, whether it is small and medium-sized board or gem, those forums, whenever entrepreneurs in charge of the listing of companies, creating a new generation of rich. In other words, the structure of the rich has changed, before the rich are mostly property developers, mine owners and so on, now is to do the service, do investment has been a huge return, and gradually become a very rich one, they are very interested in investment, innovation, support the new generation of capitalists are very interesting, the whole environment caused a lot of the emergence of VC.

As with the previous PE heat, the current VC fever also has a lot of traps. "From the general direction of view, VC fever is a positive signal." But many people copy, reproduce people around or other successful experience, there must be a trap. Wangzen said, frankly, other people's success can not only read news reports and memoirs, from the human nature, their entrepreneurial story is not all written up. Therefore, whether PE or VC, the final trend is value investment. Value investment is not representative of the late-stage investment, as early as should look for the core value of the project, Buffett's value investment can be applied to VC.