What are the financing methods of private equity funds? Since the main source of funds for private equity funds is the registered capital raised, it also includes the follow-up fundraising and fund development according to the project during the fund development process. Therefore, generally speaking, there are two ways to raise private equity funds: registered capital raising and management company raising.

1, registered capital raising

Registered capital raising refers to the direct establishment of enterprise private equity funds according to the Company Law and the Interim Measures for the Administration of Venture Capital Enterprises. The raised funds are used as the source of registered capital and investment funds, and the investors and their contributions are determined when the company is established. After the establishment of the company, if it needs new funds or investors, it will adopt the way of increasing capital and shares; If the investor withdraws, it will take the form of capital reduction or equity transfer (generally speaking, equity transfer is taken because there are many restrictions on capital reduction). The way of raising registered capital means that the shareholders of the company may change, which is not conducive to the sustainable and long-term development of the company. Especially for private equity funds with limited liability company system, because of their strong affinity with shareholders, they don't want frequent changes of shareholders, and the way of raising registered capital sometimes makes academician shareholders unwilling to accept it.

2. Manage the company's products

Management company offering is generally used after the development of private equity funds in enterprises to a certain stage. At this time, private equity funds have accumulated certain achievements, have certain brand influence, and have the qualification and ability to raise other people's funds for investment. The sale of a management company refers to the establishment of a new fund, that is, a limited partnership private equity fund, with its own management company and its own promoters, and its status and role are equivalent to that of a general partner. After a certain stage of development, many domestic start-ups will invest by setting up other funds to achieve sustainable development.