Operation process of private equity investment: If private equity investment activities can be divided into four stages: project search and project evaluation ⒉ investment decision N⒋ Investment exits four stages The dictation to many operating practices at each stage, such as the first stage of project search and project evaluation specific. Evaluation and other content. . Different from most other forms of capital, it is also different from borrowing or listed companies’ stock investment. While the manager or manager of a private equity investment fund brings capital investment to the enterprise, it also provides management technology, corporate development strategy, and other other parties The value -added service is a long -term investment with the original intention of strategic investment. Of course, its operating process will also be a long -lasting process. The operation methods of domestic private equity investment funds and overseas entrepreneurial investment funds are basically the same, that is, after fund managers raised funds through non -public ways, they invested funds to the equity of non -listed enterprises, and management and controlling companies invested to maximize the company to maximize the company to maximize the company The value -added is limited to the company’s listing or withdrawn from the funds after being acquired, recovering the principal and obtaining income. Its investment operations are basically completed according to a series of steps. Starting from discovery and determining the project, and then experiencing negotiation and due diligence, determining the final contract terms, investment and completion of transactions, and passed subsequent project management until the investment exit obtain obtained obtaining the exit income. Of course, the characteristics of different private equity investment funds are different, and the workflow will be slightly different, but basically the same is similar. 1. Finding project The important foundation for the success of private equity investment is how to obtain good projects. This is also the most direct test of fund managers’ ability. For a detailed investigation, it is a way to discover good projects. In addition, the connection with senior management personnel with various companies and the majority of social interpersonal networks are also one of the sources of excellent projects. For example, investment banks, accounting firms, and law firms such as various types may provide a lot of valuable valuable service institutions. information. Of course, the most direct way is to obtain a business plan submitted directly by the project party. After obtaining relevant information, private equity investment companies will contact the target company to express their interest in investment. If the other party is also interested in, it can conduct preliminary evaluation. 2. Preliminary assessment After the project manager claims to the project, under normal circumstances, the preliminary judgment of the project should be completed in a short period of time.项目经理在初步判断阶段会重点了解以下方面:注册资本及大致股权结构(种子期未成立公司可忽略)、所处行业发展情况、主要产品竞争力或盈利模式特点、前一年度大致经营情况、 Preliminary financing intentions and other companies that help project managers judge the investment value of the project. The preliminary judgment is the basis for further discussions with company management and due diligence. In the process of preliminary evaluation, we need to communicate with customers, suppliers, and even competitors of target companies, and refer to the research reports of other companies as much as possible. Through these tasks, private equity investment companies will have a deeper understanding of the main attention points such as industry trends and business growth points where investment targets are located. 3. After the due diligence , after the preliminary assessment, the investment manager will submit the “Proposal”, and the project process has also entered the stage of due diligence. Because the success or failure of investment activities will directly affect the future development of both investment and financing companies, investors must clearly understand the detailed situation of the target company when deciding, including the operating conditions, legal conditions and financial conditions of the target company. There are three main purpose of due diligence: discovering problems, finding value, and verifying information provided by financing companies. In this stage, in addition to hiring accounting firms to verify the financial data of the target company, inspecting the company’s management information system, and auditing work, the technology, market potential and scale, and management of the target enterprise will The team conducted a careful assessment. This procedure includes contact with potential customers, consulting with industry experts and holding talks with the management team to audit assets. It may also include talking with corporate creditors, customers, and related personnel such as previous employees. The opinions of these people will help investment institutions to make conclusions about corporate risks. 4. Design investment plans In due diligence, the project manager shall form a research report and investment plan proposal to provide financial opinions and audit reports. Investment plans include valuation pricing, board seats, veto, and other corporate governance issues, exit strategies, and determining the terms of contract terms. Due to the different starting points and interests of private equity investment funds and project companies, the two parties often have different differences in negotiations of valuation and contract terms. The technical requirements for solving the differences are high. It requires negotiation skills and assistance from accountants and lawyers. 5. Transaction structure and management If investors generally do not inject all investment at one time, but adopt installment investment methods. Each investment is based on the goal of enterprises to achieve the goal of advance setting. Method supervision. This is a necessary means to reduce risk, but it also increases the cost of investors. In the process, different investors choose different supervision methods, including adopting a report system, monitoring system, participating in major decisions and strategic guidance. In addition, investors will also use their networks and channels Increase income by giving play to synergy effects and reducing costs. 6. The exit of the project The withdrawal of private equity investment refers to the fund manager’s equity of the fund manager sold the equity of the investing enterprise in the market to recover the investment and achieve investment. The withdrawal of private equity investment funds is the last ring in the private equity investment link. This link is related to the recovery of its investment and the realization of value -added. The purpose of private equity investment is to obtain high returns, and whether the exit channel is unblocking is an important issue that is related to whether private equity investment is successful. Therefore, the exit strategy is a factor that the private equity investment fund needs to pay attention to when starting to screen the enterprise. The whole process from the beginning of the finding project to the end of the exit project, the complete process of completing a private equity investment project. In real life, investment institutions may operate several projects at the same time, but basically each project must go through the above processes.
Operation process of private equity investment:
If private equity investment activities can be divided into four stages:
project search and project evaluation
⒉ investment decision N⒋ Investment exits four stages
The dictation to many operating practices at each stage, such as the first stage of project search and project evaluation specific. Evaluation and other content.
. Different from most other forms of capital, it is also different from borrowing or listed companies’ stock investment. While the manager or manager of a private equity investment fund brings capital investment to the enterprise, it also provides management technology, corporate development strategy, and other other parties The value -added service is a long -term investment with the original intention of strategic investment. Of course, its operating process will also be a long -lasting process. The operation methods of domestic private equity investment funds and overseas entrepreneurial investment funds are basically the same, that is, after fund managers raised funds through non -public ways, they invested funds to the equity of non -listed enterprises, and management and controlling companies invested to maximize the company to maximize the company to maximize the company The value -added is limited to the company’s listing or withdrawn from the funds after being acquired, recovering the principal and obtaining income. Its investment operations are basically completed according to a series of steps. Starting from discovery and determining the project, and then experiencing negotiation and due diligence, determining the final contract terms, investment and completion of transactions, and passed subsequent project management until the investment exit obtain obtained obtaining the exit income. Of course, the characteristics of different private equity investment funds are different, and the workflow will be slightly different, but basically the same is similar.
1. Finding project
The important foundation for the success of private equity investment is how to obtain good projects. This is also the most direct test of fund managers’ ability. For a detailed investigation, it is a way to discover good projects. In addition, the connection with senior management personnel with various companies and the majority of social interpersonal networks are also one of the sources of excellent projects. For example, investment banks, accounting firms, and law firms such as various types may provide a lot of valuable valuable service institutions. information. Of course, the most direct way is to obtain a business plan submitted directly by the project party. After obtaining relevant information, private equity investment companies will contact the target company to express their interest in investment. If the other party is also interested in, it can conduct preliminary evaluation.
2. Preliminary assessment
After the project manager claims to the project, under normal circumstances, the preliminary judgment of the project should be completed in a short period of time.项目经理在初步判断阶段会重点了解以下方面:注册资本及大致股权结构(种子期未成立公司可忽略)、所处行业发展情况、主要产品竞争力或盈利模式特点、前一年度大致经营情况、 Preliminary financing intentions and other companies that help project managers judge the investment value of the project. The preliminary judgment is the basis for further discussions with company management and due diligence. In the process of preliminary evaluation, we need to communicate with customers, suppliers, and even competitors of target companies, and refer to the research reports of other companies as much as possible. Through these tasks, private equity investment companies will have a deeper understanding of the main attention points such as industry trends and business growth points where investment targets are located.
3. After the due diligence
, after the preliminary assessment, the investment manager will submit the “Proposal”, and the project process has also entered the stage of due diligence. Because the success or failure of investment activities will directly affect the future development of both investment and financing companies, investors must clearly understand the detailed situation of the target company when deciding, including the operating conditions, legal conditions and financial conditions of the target company. There are three main purpose of due diligence: discovering problems, finding value, and verifying information provided by financing companies.
In this stage, in addition to hiring accounting firms to verify the financial data of the target company, inspecting the company’s management information system, and auditing work, the technology, market potential and scale, and management of the target enterprise will The team conducted a careful assessment. This procedure includes contact with potential customers, consulting with industry experts and holding talks with the management team to audit assets. It may also include talking with corporate creditors, customers, and related personnel such as previous employees. The opinions of these people will help investment institutions to make conclusions about corporate risks.
4. Design investment plans
In due diligence, the project manager shall form a research report and investment plan proposal to provide financial opinions and audit reports. Investment plans include valuation pricing, board seats, veto, and other corporate governance issues, exit strategies, and determining the terms of contract terms. Due to the different starting points and interests of private equity investment funds and project companies, the two parties often have different differences in negotiations of valuation and contract terms. The technical requirements for solving the differences are high. It requires negotiation skills and assistance from accountants and lawyers.
5. Transaction structure and management
If investors generally do not inject all investment at one time, but adopt installment investment methods. Each investment is based on the goal of enterprises to achieve the goal of advance setting. Method supervision. This is a necessary means to reduce risk, but it also increases the cost of investors. In the process, different investors choose different supervision methods, including adopting a report system, monitoring system, participating in major decisions and strategic guidance. In addition, investors will also use their networks and channels Increase income by giving play to synergy effects and reducing costs.
6. The exit of the project
The withdrawal of private equity investment refers to the fund manager’s equity of the fund manager sold the equity of the investing enterprise in the market to recover the investment and achieve investment. The withdrawal of private equity investment funds is the last ring in the private equity investment link. This link is related to the recovery of its investment and the realization of value -added. The purpose of private equity investment is to obtain high returns, and whether the exit channel is unblocking is an important issue that is related to whether private equity investment is successful. Therefore, the exit strategy is a factor that the private equity investment fund needs to pay attention to when starting to screen the enterprise.
The whole process from the beginning of the finding project to the end of the exit project, the complete process of completing a private equity investment project. In real life, investment institutions may operate several projects at the same time, but basically each project must go through the above processes.