private equity investment

Private equity investment fund equals VentureCapital (VC). European Private Equity and Venture Capital Association (EVCA) defines private equity investment as professional equity investment in the early stage (seed stage and start-up stage) and expansion stage of enterprises.

At present, there are different definitions of private equity investment at home and abroad. Generally speaking, there are broad and narrow definitions. Private equity investment in a broad sense refers to raising funds through non-public forms and making various equity investments in enterprises. This kind of equity investment covers all stages of equity investment before initial public offering, that is, investment in enterprises in seed stage, initial stage, development stage, expansion stage, maturity stage and Pre-IPO stage, as well as private investment after listing (such as private investment in public equity, PIPE). Private equity investment in a narrow sense mainly refers to the private equity investment part of mature enterprises that have formed a certain scale and generated stable cash flow, mainly refers to the private equity investment part in the later stage of venture capital.

Private equity investment usually takes the form of funds as the carrier of fund raising and is operated by professional fund management companies. The internationally renowned investment institutions we are familiar with, such as Carlyle Group, KKR, Blackstone Group and Sequoia Capital, are all management companies of private equity investment funds, and they all operate a number of private equity investment funds.

Characteristics of private equity investment

(1) Fund-raising is private and extensive. Private equity investment funds are mainly raised by a few institutional investors or individuals in a private way, and their sales and redemption are carried out through private consultation with investors; There are many sources of funds, such as wealthy individuals, venture funds, leveraged M&A funds, strategic investors, pension funds and insurance companies.

(2) The investment target is an unlisted enterprise with development potential. Private equity investment generally invests in private companies, that is, unlisted enterprises, and the only criterion for its project selection is whether it can bring high return on investment, not whether it applies high technology or new technology. In other words, the key is whether a technology or a corresponding product has a good market prospect, not just the advanced degree of technology.

(3) Financial support and management support for equity integration of investment target enterprises. Private equity funds mostly use equity investment and enjoy certain voting rights in the decision-making management of the invested enterprises. Reflected in investment tools, most of them are in the form of common stock or transferable preferred stock and convertible bonds. Private equity investors usually participate in the management of enterprises, which are mainly manifested in participating in the board of directors of enterprises, planning additional investment and overseas listing, helping to formulate enterprise development strategies and marketing plans, monitoring financial performance and operating conditions, and assisting in handling enterprise crisis events. At present, some famous private equity investment funds have rich industry experience and resources, which can provide effective suggestions and support for enterprises in strategy, financing, listing and talents.

(4) It is a medium-and long-term investment with poor liquidity. Private equity investment has a long term, generally a project can reach 3 to 5 years or even longer, which belongs to medium and long-term investment; Investment liquidity is poor, and there is no ready-made market for the transferor and buyer of unlisted company's equity to directly reach a transaction. It should be noted that private equity investment itself is to find investable projects from a global scale, and does not distinguish between international and domestic.

Registration management of private equity fund companies

The name conforms to the Regulations on the Administration of Name Registration, and it is allowed to use the name of an investment enterprise that has reached the scale? Investment fund? Words.

Can the trade terms in the name be used? Venture capital fund, venture capital fund, equity investment fund, investment fund? And so on. ? Beijing? As an administrative division, it is allowed to be used between trade names and industry terms.

Fund type: investment fund company? The registered capital (contribution) is not less than 500 million yuan, all of which are in cash, and the paid-in capital (contribution) at the time of establishment is not less than 654.38+0 billion yuan; Pay in full the registered capital in accordance with the articles of association (partnership agreement) within 5 years. ?

The contribution of a single investor shall not be less than 6,543,800 yuan (except for the general partner in a limited partnership).

At least 3 senior managers have experience in equity investment fund management or related business.

The business scope of fund enterprises is approved as: investment, investment management and consulting of non-securities business. (Fund enterprises may apply to engage in other business projects outside the above business scope, but shall not engage in the following business:

Issue loans;

Publicly traded securities investment or financial derivatives trading;

Raise funds in an open way;

Provide guarantees to enterprises other than the invested enterprises.

General process of registering a company

1. Signature: Go to the Industrial and Commercial Bureau to get one? Application form for pre-approval of enterprise name? Fill in the name of the company you want, and the industrial and commercial bureau will search online (the intranet of the industrial and commercial bureau) to see if there is a duplicate name. If there is no duplicate name, you can use this name and send a copy? Notice of pre-approval of enterprise name? .

2. Rent a house: rent an office in a special office building. After renting a house, a rental contract should be signed and filed with the Housing Authority.

3. write? Charter? The articles of association need to be signed by all shareholders.

4. Carve a private seal: (All shareholders) carve a private seal at the place where the seal is engraved on the street and tell them to carve a corporate seal (square).

5. Take it from an accounting firm? Bank confirmation letter? Contact the accounting firm to get one? Bank confirmation letter? (It must be the original, and the accounting firm should be stamped with a fresh seal).

6. Registered company:

Obtain various forms of company establishment registration from the Industrial and Commercial Bureau, including the application form for establishment registration, the register of shareholders (promoters), the registration form of directors, managers, supervisors, legal representatives, designated representatives or entrusted agents, etc. Fill it out and submit it to the Industrial and Commercial Bureau together with the Notice of Name Approval, Articles of Association, Rental Contract, Copy of Property Ownership Certificate and Capital Verification Report. It takes about 15 working days to get the license.

7. With the business license, engrave the official seal and financial seal at the engraving company designated by the Public Security Bureau. In the following steps, you need to use the official seal or financial seal.

8. Handling the enterprise organization code certificate: It takes 3 working days to handle the organization code certificate with the business license to the Technical Supervision Bureau.

9. Handling tax registration:

After receiving the license, you should go to the local tax bureau for tax registration certificate within 30 days. General companies need to apply for two kinds of tax registration certificates, national tax and local tax. When handling the tax registration certificate, you usually need an accountant, because one of the materials required by the tax bureau is the accounting qualification certificate and ID card. Of course, you can ask the agency bookkeeping company to do the accounts.

10, go to the bank to open basic deposit account:

With the original business license, organization code certificate, national tax and local tax, go to the bank to open basic deposit account.

1 1. Apply for an invoice: If your company sells goods, you should apply for an invoice in the national tax; If it is a service company, it should handle the invoice in the local tax.