The_venture_capital_SCGC_XIA.ppt

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  • 1. The Venture Capital and High-tech Firm Financing Mechanism Dr. Xia LI General Manager Centre of Venture Capital Research and Development Shenzhen Capital Group Ltd. July 3, 2008
  • 2. Content
    • 1 、 VC Background in China
    • 2 、 The Characteristics of High-Tech Firms in China
    • 3 、 How do VCs invest High-tech Firms in China?
  • 3. 1. VC Background in China
    • The typical VC industry has only less than 10 years history, which can be divided into two periods:
    • period 1: 1999 to 2005
    • period 2: 2005 to present
    • The liquidity reform of China Capital Market, which happened in 2005, is the milestone of China VC industry. So the China VC believe that the Coship listing is the symbol of “ The VC Spring’s Coming”;
    • The VC mechanism is developing very fast, and the investment preference is changing.
    • Beijing, Shanghai and Guangdong are 3 centers of VC industry in China.
  • 4. 2. The Characteristics of High-tech Firms in China
    • The entrepreneurs have very strong technological background.
    • A lot of High-tech Firms have their own Intellectual Properties.
    • Most of them are based on the market-oriented strategy.
    • Most of them are the Small and Medium Size enterprise, which is sometimes neglected by the financial market.
    • Most of them can get some assistances from the Governments.
  • 5. 3. How do VCs invest High-tech Firms in China?
    • How do VCs pick up the High-tech Firms?
    • How do VCs evaluate the High-tech Firms?
    • How do VCs make the decision to invest High-tech Firms?
    • What do VCs do for the High-tech Firms after the investment?
    • How do VCs exit from the High-tech Firm investment?
  • 6. 3. How do VCs invest High-tech Firms in China?
    • How do VCs pick up the High-tech Firms?
      • The clear ownership of Intellectual Property;
      • The high entrance barrier;
      • The great market growth potential;
      • The clear business model;
      • The excellent team;
  • 7. 3. How do VCs invest High-tech Firms in China?
    • How do VCs evaluate the High-tech Firms?
      • The Intellectual Property;
      • The revenue forecasting and related hypothesis/condition;
      • The team;
      • The credit records;
      • The risk factor analysis;
  • 8. 3. How do VCs invest High-tech Firms in China?
    • How do VCs make the decision to invest High-tech Firms?
      • More detail Due Diligence;
      • Panel discussion meeting;
      • Technological expert participation;
      • Multi-voting mechanism;
      • Multi-stage investments;
  • 9. 3. How do VCs invest High-tech Firms in China?
    • What do VCs do for the High-tech Firms after the investment?
      • Help High-tech Firms to obey the law and the other regulations;
      • Help High-tech Firms to make and execute their strategies;
      • Help High-tech Firms to integrate resources and expand
      • market channels;
      • Help High-tech Firms to solve difficult problems;
      • Help High-tech Firms to enhance public relations;
  • 10. 3. How do VCs invest High-tech Firms in China?
    • How do VCs exit from the High-tech Firm investment?
      • IPO;
      • Share transfer;
      • MBO;
      • Bankruptcy;
  • 11. Thank You ! Tel : 0755 - 82912888 Fax : 0755 - 82912880 11th floor, Investment Building, Shennan Road 4009 Futian Centre District, Shenzhen 518048, Guangdong Welcome to WWW.SZVC.COM.CN