Limited Partnership System: Local VC system Revolution Spring is coming soon!

7 years ago, I wrote the "Venture capital localization operation Mechanism Research" time, specially took one chapter to discuss local VC's organization form and the legal structure question. vc,80% in the United States is LP-GP, with a small number of companies (Corporate VC), such as Intel Capital. LP-GP mode of operation, is the investor as LP, is responsible for providing 99% or even all of the funds, and the amount of capital to bear limited liability, LP does not participate in investment project decision-making; GP is usually made up of successful entrepreneurs, big business executives, investment bankers or lawyers, and they represent a symbolic 1% of the money, Even at no cost, GP is responsible for investment project decision, but must bear unlimited responsibility to the fund. When it comes to sharing investment income, GP can score 15%-30%, usually 20%. The specific proportion between the LP-GP, to see the GP's past investment and the level of bargaining with the LP, in an era of excess capital liquidity, the capital market, the extra money, and excellent GP is always scarce, so now the GP share the return on investment has risen trend, The VC,GP, which was raised from the United States last year but mainly operated domestically, reached 25%. LP-GP mode, effectively solve the investor's selection of managers, the problem of incentive and restraint is completely the product of the free market contract economy, Human capital can get 20% or even higher capital gains by the brainpower, embody the great respect to human capital, and fully embody the wisdom of the American Devils in the system construction. America is strong because Americans always find the most humane system. And then the domestic VC, due to the lack of law, there is no limited partnership of the Enterprise Law, the Partnership Act, each partner is unlimited liability and not suitable for venture capital, only the domestic "company law", so the basic domestic VC adopted the form of the company, by the investors launched the establishment of Investment Co., Ltd. Then hire professionals to act as managers of the company, and shareholders usually send people to participate in investment decisions. It is totally incomprehensible to the investors in China that the investors have no decision-making power, which also reflects the huge gap between our capital market and US capital market. Under the system of the limited company, the manager is in fact the senior employee hired by the shareholder, belonging to senior employee. Compared with the limited partnership system, one is partner, one is employee, the other is partner own investment decision-making power, one is to listen to the investor's opinion, the result will be how, do not have to prove that everyone will understand: Never expect senior employee can become a venture capitalist , most of them venture capital experts. It is not surprising that VC, like Intel Capital, rarely appears in the ranks of investors on Nasdaq-listed companies. There are also some VC, commissioned by the management of the way, funded by investors to set up a limited investmentCompany, then funded by the manager, set up an Investment Management Co., Ltd., then two companies signed a commissioned management agreement, Investment Co., Ltd. is the client, investment Management Limited as a trustee, management of investment company funds, such as Shanghai Union is to take this model. The lack of such a law makes it very uncomfortable for those overseas managers who are in charge of "American money" in the country. In the case of SoftBank's big investment, SoftBank's money is money from Cisco's investment in Asia's infrastructure fund, and SoftBank is the fund manager, 40 million dollars of investment in the grand listing after the withdrawal of 530 million U.S. dollars, according to 20% of the divided, soft silver can get almost 100 million dollars in the division, the money, the vast majority of the son took away, because Yan, Joe, are soft silver senior employee, are not GP, This makes Yan, Joe are very unhappy. So only then the "soft silver independent door" incident. And the American McGovern is very clever, he is very clear, he can not always put the Shong as senior employee, so this is the IDGVC of McGovern director of the independent event, Shong and finally after years of senior vice president after the promotion of GP, As GP's power and interests have been protected by the system, and McGovern more admirable is that the former IDG investment but have not quit the project are according to LP-GP system to deal with. We have seen the reason why America has become the world's first power from the American McGovern, and from the son, a Korean-Japanese, who have seen the whole of Asian countries not being among the world's leading powers. Son, even if you go to the United States for many years, you will not learn the essence of the American Contract Society, reflecting not the son of one person, but the whole Asian culture influenced by Chinese culture. In the eyes of all Asians, only Bo and employee, no partner. Or even if you are a partner, but as long as you are not a contributor, you will never have the right to speak. Mainland China, Taiwan, Hong Kong, Japan, Korea, no country and region of venture capital can do well, and these countries and regions have a fundamental relationship between the lack of systematic construction. In this respect, the mainland is very smelly and Hong Kong and Taiwan are not strong. One of my friends, is a Hong Kong VC mainland Chief representative, but this whole day in the first generation of the international trade, there is no power to decide which project to vote, any project should be given to Hong Kong farmers to decide, and Hong Kong farmers, the whole day living in Hong Kong's cement forests do not understand what the mainland market is all about, So this VC is always not inflow VC, very normal. But a local VC to see the hope of the news is that August 27, 2006, the National People's Congress passed the newly revised "PRC Partnership Law", in the newly amended Partnership Law, the addition of limited partnership content, and will be implemented on June 1, 2007. In the second half of this year, we are expected to see the venture capital machine established in the form of limited partnershipStructure, those in the local VC senior employee, finally ushered in can elated to do GP opportunity, a local VC system Revolution Spring is coming soon! This post was edited by the author in 2007-4-23 22:36:09! This post was edited by the author in 2007-4-23 23:01:54!