Private equity investment objectives:
1, TMT: online games, e-commerce, vertical portal, digital animation, mobile wireless value-added, electronic payment, 3G, RFID, new media, video, SNS.
2. New service industries: financial outsourcing, software, modern logistics, brand and channel operation, translation, film industry, TV shopping and mail order;
3. High-growth chain industries: catering, education and training, dentistry, medical care, supermarket retail, pharmacy, cosmetics sales, sports, clothing, shoes and budget hotels;
4. Clean energy and environmental protection: solar energy, wind energy, biomass energy, new energy vehicles, batteries, energy-saving buildings, water treatment and waste gas treatment;
5. Biomedicine and medical equipment;
6. 4 trillion beneficiary industries: high-speed rail, cement and special equipment.
Read more about private equity investment funds.
Private equity funds generally refer to funds engaged in private equity (non-listed company equity) investment. Private placement is relative to public offering. At present, all funds in China are raised through public offering, which is called fund public offering. If a fund does not go through public offering, but privately raises funds from a specific target, it is called a private equity fund.
Characteristics of private equity investment funds
(A) private funds, but a wide range of channels
The scope of private equity funds is narrower than that of Public Offering of Fund, but they are all institutions or individuals with strong capital strength and high quality of capital composition, which makes the funds raised by them not necessarily inferior to that of Public Offering of Fund in quality and quantity. It can be an individual investor or an institutional investor.
(2) Equity investment, but in a flexible way.
In addition to pure equity investment, there are disguised equity investment methods (such as convertible bonds or corporate bonds with warrants) and portfolio investment methods with equity investment as the mainstay and debt investment as the supplement. These methods are a great progress of private equity in investment tools and investment methods in recent years. Although equity investment is the main investment method of private equity investment funds, its dominant position will not be easily shaken, but the rise of various investment methods and the combined use of various investment tools have also formed an irresistible trend.
(3) The risk is high, but the return is rich.
The risk of private equity investment first stems from its relatively long investment cycle. Therefore, if private equity funds want to make profits, they must make some efforts, not only to meet the financing needs of enterprises, but also to bring benefits to enterprises, which is bound to be a long-term process. Moreover, the high cost of private equity investment also increases the risk of private equity investment. In addition, the high investment risk of private equity funds is also related to the poor liquidity of equity investment. Unlike securities investment, equity investment can be bought and sold directly in the secondary market, and its exit channels are limited, and the limited exit channels may not be smooth in a specific region or at a specific time. Generally speaking, after PE successfully quits the invested company, the profit may be 3~5 times, while in China, the figure may be 20~30 times. High returns induce huge capital to flood into PE market.
(four) to participate in management, but not to control the enterprise.
Generally speaking, private equity funds have a professional fund management team with rich management experience and market operation experience, which can help enterprises to formulate development strategies that meet market demand and improve their management level. However, private equity investors only participate in enterprise management and do not control enterprises.