GEM-price ratio triggers "fear of heights" VC/PE Sidelines

"I've basically retired at home this year," he said.　　"An investor disconsolate said, the high valuation risk is also high, simply can not vote, so simply temporarily on the board is a high price-earnings ratio, so many VC/PE got fear of high disease." Qing Ke Group founder Gavin clearly remember, the Beijing Olympic Games after the bargain is also easy, the company bid 8 times times, investors can cut to 3 times times, but now? Some companies ask for 20 times times or 30 times times, want to bargain? No talking!　　The enterprise is justly looking for someone else to go.　　Perhaps we should not easily blame the Gem 100 times times PE, perhaps this is the current economic environment of the new "normal"? But don't forget the simplest rule of investing: rewards and risks are linked.　　If the VC/PE sector in China earns 80% of its money in 20%, it is likely that more than half of the institutions are paying for it, but one of them is certainly the rising cost of investment. Adhere to rational investment "I have basically retired this year.　　"The risk of high valuations is too high to be voted on," said one investor, who is momentarily sidelined.　　In fact, although the "fear of heights" is already the "normal" of the industry, the valuation of VC/PE investments in the 2009 did not actually raise prices much. CBN reporters made a small survey, the astute investors are not the answer is high.　　They unanimously declared: we only make rational investment! Sequoia Capital Partner Kui's answer is 5 to 10 times times; Shaw, managing director of Germany's capital, is 3 to 4 times times the answer to Zhangsuyang, the founding partner of Joe, who said that the companies he invested in 2008 or 2009 were rarely profitable when they invested.　　So there is no PE standard.　　"The illusion of gem has spread to the front of the industrial chain, that is, investment pricing above, one-night wealth is only a myth, do not think that is a new normal," Shaw said, the gem is a high price-earnings ratio is caused by serious imbalance between supply and demand, the national investors, such as Gem 10 years, can cast only 28.　　For these investors, the principles they espouse are simple: investors ' behaviour and mentality are important to the industry as a whole, and if it is short-term for both entrepreneurs and investors to raise prices, the risk will grow beyond control.　　Leveling investment mentality Liu, chairman of Citic Industrial Fund, said that the current gem of the 100 times-fold price-earnings ratio of the bubble is unsustainable, but in the short term, multiples of the gem is likely to last two or three years.　　"If the gem is not as high as it is after half a year, and the firm's expectations are high, and there is a good chance that the investments that could have been made could not be discussed in this case, Zhangsuyang said, and that the current high prices could be an incentive for companies wanting to go public, which is beneficial.　　But too high could be a burden for new investors. Joe that the overall trend of corporate speculation has beenOverall to the industry caused a relatively negative impact. "Valuations are too high for investors and for the industry to develop, which allows both companies and investors to start chasing short-term benefits."　　"Joe Blushes, he saw a lot of investors do not do what they should do, many entrepreneurs into the capital after they think they become billionaires."　　Fortune Executive partner Bing told CBN Reporter, now the turnover rate of the gem is nearly 100%, if these are retail investors in the speculation, the venture to exit after a year is worrying. "In many cases, organizations will have to do big deals, but what institutional investors are going to buy you?" Bing said, at present, many two-level market investors in China did not intervene in the gem.