Equity investment strategy diversification positive innovation Entrepreneurship

Our reporter Zuo Yonggang reported that the latest statistics of the research center of the Qing Branch show that in June this year a total of 37 Chinese enterprises in the domestic and foreign capital markets to achieve initial public offerings, including venture capital/private Equity (VC/PE)-supported Enterprises 15, created a total of 29 IPO exit,　　Involving 26 VC/PE institutions, the average book investment returns multiples of 3.73, the lowest return on IPO returns in nearly a year. "Although equity investment in the first half of this year showed a comprehensive and rapid development trend, but the June VC/PE exit return began to fall, which means the VC/PE profiteering ERA or will end." Fu Shinghua, managing director of the research center in the Qing Dynasty, said that VC/PE investment strategy began to change, the fund industrialization speed up, together with the Government to guide the Fund and the establishment of cooperative relations with the park become a trend. It is noteworthy that the VC/PE investment in the early and middle and late two-way movement trend.　　Unlike in the past, joint ventures have been gradually accepted by VC/PE. IPO exit returns are low according to the Chingko Research Center, in June this year a total of 15 VC/PE-backed Chinese companies implemented IPOs inside and outside the country, totaling $1.765 billion trillion, with an average of $118 million per company financing. Among them, 12 enterprises in the domestic capital market IPO, aggregate financing of 1.494 billion U.S. dollars, and 3 in the overseas capital markets to achieve IPOs, aggregate financing of 271 million U.S. dollars. Among the 12 VC/PE-backed Chinese companies that have achieved domestic IPOs, the Shenzhen Stock Exchange has 6 SME boards and 4 gem boards, and there are 2 on the Shanghai Stock Exchange.　　of the 3 VC/PE-backed Chinese companies that have implemented offshore IPOs, there are 1 on the Hong Kong motherboard, the New York Stock Exchange and the Frankfurt Stock Exchange. Statistics show that 15 VC/PE support companies have created 29 IPOs, involving 26 VC/PE institutions with an average book return of 3.73. Among them, the 12 VC/PE-backed enterprises that realized the domestic IPO have created 25 IPO exits, involving 22 VC/PE institutions,　　Average book return multiples of 3.69; the 3 VC/PE-backed Chinese companies that have achieved an offshore IPO have created 4 IPOs, involving 4 VC/PE institutions with an average book return of 4. Since this year, the share price of a shares issued a P/E and the two-month average earnings ratio showed a downward trend.　　In June, the Shanghai Stock Exchange, the Shenzhen Stock Exchange SME board and the Shenzhen gem, the average issue price-earnings ratio fell by 5.3%, 33.3% and 25.6% respectively, and the gem shares issued a price-earnings ratio is constantly refreshing the minimum record. In the case of VC/PE, the decline in the IPO price/earnings ratio has increased the uncertainty of VC/PE exit with high P/E shares in order to obtain short-term high returns, so that the equity investment industry, whether in the industry or the operating modeWill be a major change in the type, some professional not strong VC/PE will be eliminated from the market. The trend of declining investment returns in the equity investment industry seems to be expected in the industry. In the 11th session of China Venture capital and private Equity investment forum, the senior executives generally believe that nearly 3 years is the most rapid development of China's equity investment industry for a period of time, high returns, rapid development has become the basic characteristics of this period.　　However, with the various funds, various institutions involved in the market, VC/PE profiteering ERA is coming to an end, a group of unprofessional, risk control of poor institutions will be eliminated. Zhanghong, chief executive officer and executive director of the bank, said that the VC/PE industry was moving towards a prosperous era, which also meant that competition for homogeneity in the industry would inevitably intensify.　　In the next 3-5 years, VC/PE will usher in the transition period, specialization will be the VC/PE development process in a very important aspect. Diversification of investment strategy the current equity investment industry is becoming more and more competitive, one of the main performance is that the enterprise valuation is generally high, which is the cause of investment risk increase and investment return decline.　　When the era of high valuations arrives, VC/PE needs to take a differentiated development route, said Zhang Junjie, an investment director. At present, the domestic VC/PE investment strategy presents a diversified development trend, in which the fund industrialization has emerged. For nearly 3 years, a number of domestic industrial funds, such as the establishment in 2009, the capital scale of 2.7 billion yuan to build a silver health care equity Investment Fund, was established in 2010, the capital scale of 3.5 billion yuan Hunan cultural industry fund, was established in 2010, the capital scale of 300 million U.S. dollars in the Shandong Peninsula Blue Economic Investment Fund,　　Founded in 2010, the capital scale of 1 billion yuan in the city of Wanjiang to undertake industrial transfer investment funds and the establishment of this year, the target capital scale of 20 billion yuan Yellow River Delta Industrial Investment Fund. In order to be able to obtain more listed (IPO) enterprises investment opportunities, a lot of VC/PE together with the government venture to guide the fund.　　Through cooperation with the Government, VC/PE can maximize the use of government resources to achieve low-cost distribution points, expansion. Shenzhen Innovation Investment Group Co., Ltd. is the adoption of this strategy to achieve the national layout of the typical investment institutions.　　2006-2010, Shenzhen Innovation in Beijing, Shanghai, Hong Kong, Shenzhen, Chongqing, Suzhou, Xi ' An, Chengdu, Wuhan, Zhongshan, Zhengzhou, Xiangtan, Weihai, Hefei, Hangzhou and other locations to set up branch offices or regional guidance fund more than 40, to achieve a nationwide distribution of a wide range of points. At the same time, there are a lot of VC/PE selection and park, industrial base and other cooperation. In this regard, the Infineon Infinity Investment Group case is very many, 2010 Infineon Infinity Investment Group and Changzhou High-tech zone cooperation set up 100 million-yuan Changzhou often with the fund, and Jining Science and Technology Bureau, jining High-tech zone to set up 200 million yuan in the scale of Jining Ying Fei Infinity Venture Capital Fund, With Shijiazhuang National Bio-industrial base to set up 200 million yuan scale stone homeZhangshi with the fund, and Ningbo high-tech zone to set up a 500 million-yuan Ningbo new fund.　　This year, Ying Fei Infinity Investment Group and Chongqing Liang Jiang New District, Zhongqing financial office to set up a 2 billion-dollar British-fly Infinity River New Zone Fund. Industry insiders said that the industrial fund combined with local industrial conditions, can provide a professional all-round value-added services, to promote the development of local industries and speed; With the government Venture investment guide funds or parks to facilitate VC/PE mining investment projects, under the impetus of VC-led fund,　　More start-up companies will have access to financing opportunities. Value-added services are valued at present, one of the changes in the VC/PE investment strategy is the shift of investment phase. Investment institutions began to increase the growth and maturity of enterprises and investment ratios, such as the early entry to the Chinese market IDG Capital, Sequoia Capital and other investment institutions in recent years have shown a trend of investment stage.　　The reason why the investment institutions make this strategy change is that, on the one hand, because of the enlargement of the institutional management capital, the capital strength of the mature project with higher investment valuations; On the other hand, such projects have lower investment risk, shorter investment time and quicker capital turnover. Fu Shinghua said that while some of the investment institutions focused on early investment were expanding to the middle and late stages of the project, a number of institutions had extended their investment to start-up companies to avoid higher-priced projects in the middle and late stages.　　In addition, joint ventures are beginning to be accepted by VC/PE. Professionals say the advantages of joint investment mainly include 4 aspects: one is to diversify investment risk. VC/PE in the process of investment often because of asymmetric information, resulting in increased investment risk, joint investment to some extent to make up for the individual institutions in the project evaluation and risk control limitations, conducive to project evaluation and decision-making optimization, reduce the risk of investment decisions. The second is to make up for the lack of funding scale. Part of the project because of the high investment, VC/PE fund size or fund investment restrictions led to its inability to complete the investment, through joint investment to form a scale, so that investment institutions have the opportunity to enter the larger investment transactions. Third, we can make up for the deficiencies in value-added services. Through the joint investment, the investment institutions can achieve complementary resources and further strengthen the support and help to enterprises.　　Four are some of the institutions focused on early investment after the initial round of financing of the enterprise, for their own financial strength or the optimization of the ownership structure of the enterprise, will assist enterprises in the subsequent financing rounds of the introduction of other investors, their own in the late rounds of the lead or to vote, or no longer follow up the investment. "As competition for investment projects intensifies, VC/PE can benefit from a joint venture to avoid a scramble for projects to boost valuations." Fu Shinghua said that the full range of value-added services has become the core competitiveness of investment institutions. This includes not only to provide funds for enterprises, but also to assist enterprises to complete the listing, to provide enterprises with strategic, management, technology, resources and other aspects of value-added services, so that enterprises gain value added, and ultimately achieve long-term total win.