The exit path Narrows, the start-up project chain breaks

Exit path narrowing, entrepreneurial project chain broken, more and more Internet concept companies want to seek breakthroughs.

"Hong Kong's stock market is becoming more attractive to listed Chinese companies," said AdChina, the easy-media CEO, who meets in Hong Kong on February 6. This feeling, after one weeks, turns out to be a real and slightly regrettable decision to show that the public is in a position to withdraw from the US listing, and to highlight the need to contact other suitable listing sites, with emphasis on Hong Kong.

The rationale for the company is that "the timing of the IPO is now and is not expected to be ideal for a long time".

In February 2012, Easy Media submitted an IPO application to the U.S. Securities and Exchange Commission (SEC). The prospectus shows that the net income of the Yi Media in 2009 was $10.79 million, 2010 was $27.27 million, 2011 was 50.67 million dollars, and the annual compound growth rate was 117% in the last three years.

The amount of funding for easy media is not as high as 100 million dollars. But a person familiar with the matter said that if the "penny" could not be achieved, the current U.S. stock market is too cold.

As AdChina said, "TMT companies are increasingly considering the Hong Kong market." However, another company that is preparing to go public has revealed that not only is the US stock market very cold, but Hong Kong is also cold. If listed in Hong Kong, whether Alibaba decided to go public will play a benchmark role.

The past two years, the U.S. capital market is too calm, the impact of the Vie event on domestic companies, the attack of short institutions and the Chinese concept of the financial fraud and other adverse factors, even under the attack, the venture capital exit path is becoming narrower 2012, only the goods will and yy two companies successfully landed in the U.S. stock.

In the cold exit channel, the venture capital "heap" of China's technology, the Internet, new media, such as the entrepreneurial chain, is experiencing a complete bloodbath, including many investment funds, waiting for them may be more bloody integration. What is even more frightening is that the vicious circle has emerged: the old club cannot go public, and the Chinese entrepreneurial army cannot get out of the way and wrap it up.

Rome Rome

As the first Internet companies such as Sina, Sohu, after landing on the Nasdaq, the story of the rich, tolerance of losses listed and willing to give high valuations of technology companies, the U.S. stock market has become a "dream" of Chinese entrepreneurs, many entrepreneurs even the ability to log on to Nasdaq as a lifelong dream.

But in the last two years, the market is not good. Chinese companies that have opted to privatize in the past year have reached a record high, creating a trend towards privatization, and companies with poor performance have been notified by US regulators of the need to retire.

However, Analysys International analyst Zijianzhe that the most important reason for the media to abandon U.S. capital markets is that they do not recognise the model of easy media because it is a Chinese company. The mode of easy media is not recognized, the valuation or price is not up to the expectations of easy media.

Even in 2012, the successful listing of YY, its listing process also makes Lei gripped: according to Lei Memories, YY's IPO roadshow began when Obama was elected the first day, the results of Obama's election after the U.S. stock company fell three days, let Yy came up with a heavy burden.

Just as Lei was thinking about how to make a higher price. The investment bank told him that there were 7 companies planned to go public this week, including the YY gathering, with the first US company receiving 18 times times oversubscribed and pricing at the top, with the result falling 18% on the day of the IPO, and the second American company, 5 times times oversubscribed, Pricing set in the price range of the lowest line also fell 3 dollars, the price is very poor, and 4 think the situation is not good to give up. At that time all the investment banks and Lei and Lee Colling said is "very bad", but Lee Colling feel as long as ready to go, the price is not the first, great companies have to go step by step. But AdChina apparently made another choice.

In fact, from the July 2011 Thunder down the issue price and eventually suspend the IPO, there is a saying is that the subscription is not ideal, followed by Shanda literature also announced the suspension of the NYSE IPO plan. At that time, the two companies in the financing amount of 200 million U.S. dollars, and the choice to leave the media, the listing of financing only 100 million U.S. dollars.

A well-known investment company insiders revealed that the U.S. stocks there are most investors in the kind of "I will not fancy the" state. Another investment banker said many U.S. investors in the last round of Chinese concept stocks were short of the process of losing money, now on the stock is a bit fearful, not afraid of shorting institutions, but the Chinese companies themselves have a lot of problems, credibility, financial fraud, slow to profit and listing is to circle money and so on.

But Analysys international analyst Zijianzhe believes that only the goods will and YY can prove that the Vie event is no longer the main reason for the Chinese companies, the two companies now market performance is enough to refute this view. In Zijianzhe's view, the current environment has not changed, but it will not be as bad as before.

However, if a start-up company cannot get to the city, it can only die, or seek financing or be acquired. Obviously, many companies sell very cheaply, but people who invest money are more cautious.

Chinaventure's figures show that the average single investment in 2012 was $8.42 million trillion, down 8.1% from the previous year.

In fact, as domestic and foreign capital markets continued to slump, the valuation of listed companies declined, the first-tier market investment valuations also appear rational regression. 2012 transaction amount of the largest VC case is a new round of financing millet technology, involving the amount of 216 million U.S. dollars, other cases of transactions in the amount of 100 million U.S. dollars below.

The number of companies that are lucky to be listed is also greatly impaired. Chinaventure's data show that in 2012 a total of 97 VC/PE-Background Chinese enterprises in the global capital market to achieve a listing, total financing amounted to 80.11 billion yuan, the amount and amount of year-on-year decline of 41.2%, 55.4%, The amount of listed financing reached a low of nearly 4 years.

"Money-deficient" "Rich man."

Chinaventure analyst Feng Po that U.S. investors still have a lot of questions about Chinese companies, and nothing has changed. In addition, China's macro-economy is slowing across the Chinese market, and the market growth faced by Chinese companies is being kept fast and questioned by US investors. So there has been little good news over the past year to support Chinese companies continuing to go public in the US.

If enterprises can not be listed, then the institutions of investment enterprises are miserable they have the fund's "checkout period", affecting a considerable part of the fund's refinancing.

According to the Chinaventure Investment Group's financial data products Cvsource statistics show that 2012 China's VC/PE market funds continued to weaken, the annual fund raising scale sharply contraction. According to Cvsource statistics, in 2012 a total of 266 funds to raise 27.535 billion U.S. dollars, compared with 2011 year by 47.1% and 44.3% respectively.

This has also shifted many PE to a more upstream venture, as early ventures can exit through the next round of financing.

Unlike the mainstream of growth funds in the past two years, 2012 has shown a trend towards early-stage investment in "money". At present, the 163 funds funded by the Fund accounted for 61.3% of the Investment fund, while the currency, the renminbi fund is still the absolute mainstream, but in the past year, the size of the increase in fund-raising has been more than the dollar fund.

Feng Po said that there is less money to take, start-up companies are either mergers or acquisitions, or continue to finance, such as Jingdong Mall. Of course, some good projects, such as already profitable projects, can get money, but valuations may not be as high as they were in 2010, and the Internet concept does have a bit of a bursting sensation.

From the data, in 2012, a total of 137 mergers and acquisitions withdrew, and the total return of the book exit of about 3.555 billion U.S. dollars, the average book return is only 1.1 times times.

In fact, the 2012 market "Winter" has also made corporate valuations return to rationality. Feng Po that the next year, China's VC investment activity will increase, the scale of investment rebound. But in view of the large backlog of investment institutions to withdraw, demand in the short term can not be fully released, and the return on investment is difficult to achieve the expected level. Its investment strategy will remain generally cautious, and it is expected that investment will be difficult to return to its peak in 2011 for the year 2013.

Crispy chain

Another serious consequence of the IPO market upset is that fewer people are starting a business.

A well-known investment company insiders revealed that the entrepreneurial people have a strong trait is that the company listed the success of the vice president, the director, they are generally experienced a company listed, get their own stock options, before it is possible to start a business.

But current companies cannot go public, and their stocks and options are not available, and they cannot leave the company because they have to "watch" their stock options. "Or the stock market is not good, he can not sell, why did he come out?" So just stay. These are related, the whole industry chain, he does not venture out, the project supply is less, you early supply less, relatively speaking money is still a lot of. "The investor believes that, despite the decline in the total fund, but the current investment area is not short of money, money is still a lot of cases, but the lack of high-quality companies and good quality projects."

Without the entrepreneur, there is no investment in the company, the Angel has no useful, and without the early companies, PE no "stick" can be connected.

2012 VC Investment case was 566, the investment amount of 4.767 billion U.S. dollars, compared to 2011 respectively 42% and 46.7%,pe investment case 275, the total investment of 19.896 billion U.S. dollars, compared to 2011 31.9% and 31.4% respectively.

The area where overdraft is more serious is mobile internet. "Mobile internet investment is largely out of the box now. "The investors said, but some of the earliest mobile gaming companies now have a good income and a good run, but there are no particularly big projects out of the box." But investors now don't know what to do in the mobile internet world.

One reason is that the mobile Internet was overheated in 2010, for example, a mobile internet company was founded a year should have taken a round, but because it is overheating may be set up not a year to melt a round, it was founded, this money 1.5 is enough to spend, but because the concept of mobile internet was too hot, Investors spent their time in concentration, spending all of their money and projects for the next year, and when it came to normal supply, it didn't have a supply.

Of course, many companies have opted for other markets, such as a-shares and Hong Kong stocks, as well as the media.

However, the IPO company to divert A shares, the company's ownership structure adjustment is rather cumbersome, time-consuming. But from the U.S. capital market to Hong Kong is not so difficult, do not change the structure, as long as the listing requirements to follow the process.

Hong Kong Stock Exchange is actively lobbying Chinese companies listed in the United States to list in Hong Kong, including Baidu, the mainland's leading technology company, a local media reported recently. Public data show that there are 721 mainland companies listed on HKEx, while the number of listed Chinese companies on NASDAQ and NYSE two IS 165.