Private equity (private equity)
), referred to as "PE", refers to a capital operation process in which funds are raised from a small number of investors in a non-public way and investors gain income through equity investment.
Equity crowdfunding and private equity investment belong to equity investment (equity financing), and they have certain similarities, but there are the following differences:
I. Financing methods
Whether by definition or literally, private equity investment embodies the characteristics of non-publicity. Different from private equity funds, equity crowdfunding has the characteristics of openness and the nature of "public offering". Therefore, in China, the redefined "equity crowdfunding" refers to "public equity financing".
Second, the organizational form
There are two main modes of equity crowdfunding: one is corporate system, in which investors join financing companies as new shareholders; The second is partnership, in which all investors join a partnership (usually a limited partnership) and the partnership cooperates with the financier. At present, the mainstream mode of equity crowdfunding is partnership.
Compared with equity crowdfunding, the organizational forms of private equity investment are more abundant, and there are three basic organizational forms: one is company system, the other is partnership system, and the third is contract system (mainly trust system). In addition, based on three basic organizational forms, there are mixed private equity fund organizational forms, with "trust+limited partnership" as the most representative.
There is a big difference between equity crowdfunding and private equity investment funds.
Third, investors.
Both equity crowdfunding and private equity investment require investors to have certain risk awareness and risk-taking ability, but the requirements of equity crowdfunding for investors are slightly lower than those of private equity funds.
Fourth, the purpose of investment.
Obtaining income is of course the purpose of equity crowdfunding and private equity investment, but they are different. Private equity investment is to get returns, which is relatively simple. In contrast, the investment purpose of equity crowdfunding is more diverse and rich. The purpose of many equity crowdfunding is not limited to financing, but also includes the acquisition of social resources such as contacts and channels.
Verb (abbreviation for verb) investment stage
Equity crowdfunding is usually in the initial stage and early stage of enterprise development, and enterprises that invest in private equity have often developed to a certain scale.