A Study On Private Equity Financing Of Small And Medium Sized Enterprises In China

In recent years,due to funding strand breaks,Wenzhou,Dongguan and Foshan are frequent and the phenomenon of business failures,many enterprises are financing problems,for small and medium-sized enterprises,even more so.Small and medium-sized enterprises in the early stages of development,through bank loans and private capital can meet the demand for capital,but the small and medium-sized enterprise development to a certain extent,the traditional financing for enterprises is merely an utterly inadequate measure.Compared to large enterprises,small and medium enterprises' economic strength is relatively weak,the capital chain is not stable.Moreover,the credibility of SMEs is often poor,unable to obtain high loans from the bank,there is no opportunity to bond financing,it is impossible to get through the high threshold of the stock market funds.In the vagaries of the market,small and medium enterprises may at any time due to lack of funds led to bankruptcy.With the continuous development of China's economy,private equity financing for small and medium-sized enterprises entered the field of vision,people's awareness of the private equity financing more and more deep,more and more enterprises realize the importance of the new financing means.Private equity financing is different from bank loans,financial institutions tend to focus on the enterprise's profitability and risk,however small and medium sized enterprises are in small scale,weak economic strength,coupled with information asymmetry,leading banks are reluctant to give loans to smes.But private equity is equity investment,enterprises need to pay the principal and interest,but also does not require collateral,investor attention is the future development potential of the enterprise,private equity financing can not only provide financial support for small and medium-sized enterprises,but also bring a series of value-added services for enterprises.However,the development of private equity financing in China is not yet mature,and there are not many cases of private equity financing in china.In this context,how to use private equity financing to promote the development of SMEs has become the main purpose of this paper.Based on the above considerations,this paper uses the method of theoretical analysis and case analysis to analyze the problem of the private equity financing of smes.The part of theoretical analysis,based on reviewing many literatures at home and abroad,the use of information asymmetry theory and stakeholder theory,proves that private equity financing is a better way of financing for small and medium-sized enterprises.Case analysis part of the modern farming private equity financing the whole process of tracking,investigation and analysis,a comprehensive understanding of small and medium-sized private equity financing effect and problems.This paper consists of five parts: the first part is the introduction,mainly expounds the background and significance of the article,introduced the relevant literature and private equity financing,and introduces the ideas and methods of this research,as well as the overall framework;the second part is the theoretical overview of private equity financing small and medium-sized enterprises,is the theoretical part of this article.Mainly includes the meaning and characteristics of private equity financing,private equity financing of small and medium-sized enterprises in China to introduce private equity the necessity and theoretical basis;the third part is the modern farming private equity financing case introduction is the introduction part.It mainly introduces the basic situation of modern farming,private equity financing in the main,the three aspects of the financing process of the case;the fourth part is the analysis of modern farming private equity financing case is the case analysis part,which is the core chapter.It mainly includes the reasons why the case company is favored by the investors,the financing effect of the case company and the problems existing in the financing.The fifth part is the conclusion and suggestion of the case study.It mainly includes the conclusion of the full text research and the problems that small and medium-sized enterprises should pay attention to in the private equity financing.Based on the modern animal husbandry case of private equity financing analysis,this paper draws the following conclusions: the returns of modern animal husbandry is a main reason why investors favored private equity financing;the rapid development of modern animal husbandry;bring value-added services of private equity financing for modern animal husbandry;financing risk to modern private equity financing animal husbandry.On this basis,puts forward policy suggestions to promote the development of private equity financing for small and medium-sized enterprises to create conditions to attract private equity investors;ensure corporate control;attach importance to the follow-up development of private equity investors after the exit of the enterprise;considering the financing risk.