Private Equity (referred to as "PE" for short) is usually called private equity investment in China. From the perspective of investment mode, according to the definition of relevant foreign research institutions, it refers to the equity investment in private enterprises, that is, unlisted enterprises. In the process of transaction implementation, the future exit mechanism is taken into account, that is, the shares are sold for profit through listing, mergers and acquisitions or management buyback. A small number of PE funds invest in the equity of listed companies (such as PIPE, which will be mentioned later). In addition, some PE investments, such as Mezzanine, also adopt debt-based investment. However, the above accounts for only a small part, and private equity investment can still be defined as above.

Private equity investment in a broad sense refers to the equity investment covering all stages before the initial public offering of an enterprise, that is, the investment made to enterprises in various stages of seed stage, initial stage, development stage, expansion stage, maturity stage and Pre-IPO. Relevant capital can be divided into Venture Capital, development capital, buyout/buyin fund, Mezzanine Capital and turnaround capital according to the investment stage. Pre-IPO capital (such as bridge finance), and others, such as post-listing private investment in public equity (PIPE), distressed debt and real estate investment, etc. (the concepts mentioned above also overlap). In a narrow sense, PE 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, in which M&A funds and mezzanine capital account for the largest part of the capital scale. In China, PE refers to the latter to distinguish it from VC.