Npeas Wang Gang: Looking for the third "Suntech"

June 4, 2007, LDK Solar High-Tech Co., Ltd., a formal IPO at the New York Stock Exchange, successfully financed 469 million of billions of dollars, creating the largest IPO record of a single Chinese private enterprise in the United States and the largest IPO in China's new energy sector. This recalls the December 14, 2005, the same solar-powered Wuxi Suntech on the New York Stock Exchange, creating a Chinese richest man. While watching these solar star enterprises constantly refresh the capital market financing records, people often do not notice this series of investment cases behind, to help push the development of enterprises and obtain high returns of PE investors. In fact, both Suntech and LDK, the investors in the development process, have been able to see the low-key French NATIXIS Asian investment (npeas). The low-key manner does not represent mediocrities nameless, in fact, Natixis is France's second largest financial group, in the global management of more than 3 billion euros of investment funds, in China has 6 years of development history. Npeas LP currently has only one Natixis, so funds can be recycled, also known as the "Evergreen Fund." It is worth noting that only 30% of the funds used to invest in the region were used to invest in mainland China, but the proportion grew to 80% per cent as a Natixis return. Under the leadership of Npeas founder and chief partner Wang Gang, before and after the successful investment in Wuxi Suntech, Npeas successively invested six projects in China, and now the four of the seven projects have all withdrawn, a partial exit, an average return of more than 100%, and a huge profit, which is definitely an enviable report card in the investment world. What's the secret behind his success? What are the future investment plans and investment strategies? With these questions, the Qing branch observers recently exclusive interview with Wang Gang. Looking for the third "Suntech" "Suntech" is our fourth project in the country, very successful. "Wang Gang was the first PE investor to find Suntech as a potential project," he said. As the chief investor, Wang Gang coordinated several other joint investors, including Goldman Sachs, the British Alliance and Dragontech, to help Suntech write the myths of American capital markets. After the completion of the Wuxi Suntech, many people think that the ' Home Run ' project is hard to find. For me, later, the investment in LDK was more about creating a myth similar to Suntech's, "when it came to LDK, Wang Gang seemed to have the answers," and now this myth has basically come true, because LDK didn't make a profit when we invested last July, and at the end of last year we had a profit of 30 million dollars, This year's profits will be more than 100 million dollars, and after the listing is now the market value of more than 4 billion dollars. "Since the launch of Npeas China business in 2002, Wang Gang has been carrying his" boutique "complex, the heavy weight of the practice so that he control in the annual only to do 1~2 project progress, each project screening and due diligence are very picky, butOnce you decide to invest, you will do your best to ensure success. Wang Gang explains his focus so much: "In order to build a brand, the cost is not only the most economical, but also the best in terms of return." "If LDK is the second Suntech in the eyes of Wang Gang, then where is the next Suntech myth?" he said. According to Wang Gang, now Npeas single investment in the amount of 1000~3000 million dollars, basically value the annual pure profit of more than 5 million U.S. dollars, growth rate of about 30% per year in the enterprise. "In fact, in the past few years, we have invested in a lot of companies with real growth rates of more than 100%." Doing these projects is exciting, digging out a good industry and a good company in the industry, after a period of time to cultivate them from small unknown companies into China or the world within the hundred enterprises, it is a very fulfilling thing. "Obviously, Wang Gang has more plans and confidence to dig out the third, fourth ... Nth "Suntech". But these "Suntech" is not confined to the solar industry. Do not do "solar energy specialist" Wang Gang believes that solar energy is the biggest and most of the most popular investors. He has several characteristics: first, the whole industry chain technology is relatively mature, high degree of commercialization. Second, the application prospects are very wide, and there will be explosive growth, third, is the high profit, easy to copy and expand, the capital market is also very popular. But Wang Gang does not agree with some media said he is "solar professional" saying: "We are only specialized solar investors, we do 7 projects in China, only Wuxi Suntech and Jiangxi LDK is the solar project, accounting for 2/7." We will also consider the solar energy industry in the middle or downstream or other links, but also want to see more than solar energy projects. We are focusing on a wide range of areas, including energy, consumer goods, manufacturing, service industries and the medical profession (excluding pharmaceuticals). "In other areas of clean energy, Wang Gang is more optimistic about wind energy, waste power generation, sewage treatment, bioenergy and energy conservation and environmental protection." He sees different investment opportunities in the wind energy industry chain: "One is a wind power plant, the investment is relatively large, the return cycle is long, is very stable business, but not very suitable for PE investment; there is the upstream to do wind energy equipment design and manufacturing enterprises, similar to the goldwind, there is considerable human resources cost advantages, But on the scale can accept the PE investment goal is not many, this opportunity also far compares the solar energy the opportunity to be big. "Other areas of waste generation, sewage treatment and bioenergy are very Deep ', there is a difference between the wind and solar energy, such enterprises are important to see technology, such as sewage treatment, not simply to treat sewage into usable water, some technology can be extracted from the industrial sewage to recover some useful precious metals and rare metals, we prefer this kind of more professional, A high degree of commercialization of sewage treatment companies. "Wang gang further analysis that," of course, technology is not the absolute threshold, intellectual property can be artificially developed or hiredOverseas technical experts to obtain. China has a large number of manufacturing plants that can have large markets as long as they are able to set up sewage treatment networks near these factories. "There is also a part of energy conservation and environmental protection, China's high energy consumption, using a lot of polluting coal resources, the Government is taking measures to reduce energy consumption, this is a big emerging market, but the key problem is that from the technical maturity to large-scale application of the link will take some time." Wang Gang added. Without touching drugs and real estate, although the scope of attention is wide Wang Gang still has their fixed not contact areas: "Some industries are very special, such as drugs, a large pharmaceutical companies to introduce new products every year, new drug development cycle is very long, from the laboratory to the real market and to obtain recognition and success of 5-10 years time, In this long process, the risk is relatively large; second, the input cost is very high, may cast 1 billion, research and development 10 kinds of drugs, in the end are unsuccessful, may also be a drug successful and very lucrative, many different characteristics, but also need very professional skills to understand, also increased the investment uncertainty. "For the same reason, real estate is also a very special industry," he added, "from buying land to building houses, it is more influenced by the government's macro-control policy risks and some uncontrollable factors, and we can accept market risk factors." Real estate investment can also be a huge reward, but not our expertise, so we focus on some of the more familiar areas of investment opportunities, do what we are good at doing. "The difference between good and bad investors talking about the basic skills of professionals engaged in PE industry, Wang Gang thought is to investigate a project, can quickly grasp the necessary characteristics of the industry, the company's micro, macro-level of the most important information have their own understanding of the judgment. This is divided into two types of information, a kind of information is important for investors, to micro, macro decision-making plays an important role, such as entry barriers, competitors, corporate teams, market growth, enterprise development speed, cost structure, gross margin, product price sensitivity, and so on; another kind of information is very technical, Very detailed. "This is one of the biggest differences between a good investor and a general investor. "Good investors only need to grasp and understand the first class of information about 5% in a short period of time to make judgments." "Npeas's investment team has 9 people in greater China, of these, 4 Shanghai, 3 Hong Kong, 2 Taiwan, we do not have a detailed division of labour in the areas of concern, because we have our own set of methods to evaluate each investment opportunity, the evaluation system is not different from the industry. "But the internal evaluation method is not only rigorous mathematical model, Wang Gang believes that investment is the combination of art and science." From the perspective of investment art, whichever genre is likely to succeed, like Picasso and Leonardo da Vinci can achieve great success. "When we were in LDK, many investors were not optimistic about it for a variety of reasons, but it doesn't matter, I still vote and bid is not low, when the PE market said Price heightsOutrageous。 Finally, it was proved that the original decision was correct. Wang Gang stressed that investing in a project is a very rational process of thinking, with colleagues, the company's management, industry experts have a lot of brainstorming, consider all possible situations. Another way to think about it is to ask yourself whether the company will vote for its own pockets. What is the worst situation in the future? What kind of protection will the investment get? "The way you think about processes is very important, and that's the difference between good and bad investors." ”