Local VC development accelerates

Since 2007, a series of driving factors have had a great impact on the pattern change of China's venture capital market: the formal implementation of the New Partnership Enterprise law, the tightening of macro credit policy, the introduction of relevant tax preferential policies, and the strong support of the Ipo/m&a exit strategy of the domestic a-share market. Active preparation of the gem will be introduced, and so on, all of the local venture enterprises have sprung up, and wind water, has made considerable progress. According to the Chingko Research Center, only in the last six months, the number of newly established local VC companies reached 20, the amount of funds available 7.197 billion yuan (as shown in table 1). This does not include the set up Hainan venture Capital Limited and Citic Securities, CICC Securities and the Great Wall securities, such as direct investment companies or departments, as well as a number of low-key operation of the new local investment institutions. The existence of privatization from Table 1 can be seen that the participation of private capital investment institutions significantly increased, which belongs to the pure private institutions of the Oriental Moore International Investment Management AG and Shenzhen Oriental Rich Sea Venture capital enterprises, such as 6, and Shenyang Venture Investment Fund Co., Ltd. to absorb the private equity also occupies 40% of the absolute majority of the shareholder status. Some large enterprise groups began to wade into the field of investment, Wuhan Health and Development Co., Ltd., TCL Group Investment and financing department and Zhengzhou Spruce Equity investment funds are by its group of Wuhan Kin-min, tcl Group and Yutong bus set up. In addition, some domestic venture capital institutions began to "hold a regiment", through the joint strength to fight against the strength of foreign investment institutions. Techventures, president and managing partner Chen said that the surging private capital is only a small part of the venture investment, and more private private capital is not known to the public. In the long run, the privatization of local venture capital will be a big trend and will become a new force in China's venture capital market. "Local private ventures are raised again, and its ' two-pronged ' model has some advantages over foreign capital ventures. Especially in the past two years, private ventures and state-owned ventures have expanded rapidly. Bing, Shenzhen Fortune Executive vice president, believes that local private ventures are likely to share high returns with foreign investment ventures. "Caught" in the growth early in 2006, foreign investment ventures in the way of the time, has been the industry has put forward venture investment industry will become increasingly popular. In particular, more and more capital and investment institutions are being spawned, regardless of the value of the project itself to compete for the high price of events occur. Now set up a large number of private ventures in China's booming investment industry injected a new tonic, but also the original competition in the market for the new cake split, whether they can open up a new living space? Through observation can be found that the recent establishment of the venture company is "everywhere", no longer limited to Beijing, Shanghai, Shenzhen and other front-line cities, more in the two or three-line cities and regions, Tangshan, Zibo, Wenzhou, Nantong, Yangzhou, Zhengzhou, Hohhot and Xinjiang Uygur Autonomous Region. Although the competition of VC companies is increasinglyFierce, but more concentrated in the first-tier cities, these more "remote" cities and regions are now hit by foreign investment in less areas, but it is the local VC companies to provide a broad arena. In addition, the most important advantage of local private venture is to have a thorough understanding of the local market. As Xu Guan, the honorary chairman of the board of directors of Zhejiang Business Venture, said: "We grow up on this land, and we know the advantages, disadvantages and demands of Zhejiang merchants." and Zhejiang Business Venture investment investors are Zhejiang businessmen in each industry's elite and top successful people, they can bring the experience of Zhejiang merchants and business understanding, which is also investors in addition to the money hope to get. "The journey is long and mixed." The annual rankings of China venture capital and private equity investment 2007 show that some of the top local ventures have the strength to keep pace with foreign capital ventures. "China venture capital 50" in the local VC accounted for 26%, the performance of a special 3 local ventures-Shenzhen Innovation Investment Group Co., Ltd., Shanghai joint Venture Investment Management Co., Ltd. and Lenovo Investment Co., Ltd. is ranked among the top 10. In previous years, there were no more than 1 indigenous ventures in the top 10. Many local ventures have been concentrating on the harvesting period. However, this does not mean that the overall strength of local VC can be compared with foreign capital ventures. Some people in the industry, for example, some small investment companies do not regulate the operation, including the amount of investment, stage and exit mechanism are not very ideal, and some of them even do mixed business, there are some speculative nature. Some of the local venture capital's operational capacity has yet to be improved. What worries local investors is that one of their biggest strengths-the gap between government resources and foreign investment ventures is shrinking. November 2006, Kohlberg Kravis Roberts (KKR) hired Lenovo Holdings Limited president Liu and former China Netcom CEO Tian as the company's senior advisor. In January and October respectively, the Blackstone Group Ming the former Financial secretary of the HKSAR Government, Mr Antony Leung, and the "acquisition of Golden Child". In August 2007, he resigned as the chairman of Citigroup Global Financial Asia, "the father of red chips" Leung as a senior advisor to the CVC company. September 2007, Lenovo Group Co., Ltd. former executive Ma Snow Levy to the Pacific Group of Texas (TPG). Foreign private-equity firms and venture-capital firms are conducting "headhunters" in the field of talent, who will remove many obstacles to their own business through their reputation and resources at home. Foreign ventures are actively building networks and network resources, and some originally private fund-raising small venture capital companies, their own government resources are not strong, so it is easier to pull the gap. In obtaining the approval of the project party, local ventures do not have a clear advantage, especially in industries and companies that tend to list abroad, and entrepreneurs prefer to choose overseas investment companies to operate their projects, which in part indicates that the project has received international recognition and that the media has invested in the eventBody propaganda role, Invisible also expanded the company visibility, is the enterprise side icing on the cake. Thus, some local ventures took advantage of the policy and the situation of the East Wind has a good start, but also faced with a number of problems on the way forward. VC funds in general about 10 years of storage period, can be described as "long road", how many local venture to successfully and successfully completed the first journey, to win the Chinese venture capital market in the second round of competition, which is still a challenge.