BSC-based Screening Of PE Investment Projects For GX Found

In the general context of China's economic restructuring and industrial transformation,companies are hardly surviving.Attraction of private equity(hereinafter referred to as PE)investment has become a major means for SMEs to achieve strategic reform and industrial upgrading.In the current PE screening of investment projects in China,requirements are imposed only on the financial indices,while considerable vacancies remain regarding the non-financial indices,thus resulting in abortion of many high-quality investment projects.Meanwhile,performance management assessment system,as one of the most efficient channels of management,can effectively fill the vacancy of PE in the investment project screening.Hence,the key to solving the investment project issues of PE institutions is how they establish a set of appropriate screening and evaluation system for investment projects to screen,monitor and serve project investors;and to ultimately help investors get listed and exit at maximum profitability.From the perspective of PE,this paper proposes the introduction of balanced scorecard(hereinafter referred to as BSC)into the PE institution(GX Found)for project screening,in order to address the problemsencountered by the institution concerning the investment projects.It not only examines the financial indices of project investors,but also assesses the dimensions of clients,internal processes and learning and growth,thus helping the PE institution develop rational regimes regarding the screening stage,investment process and exit mode to solve the problems found herein.Initially,this paper expounds the background and significance of the selected topic.Then,it reviews the research advances in the application of performance management assessment systems and in the performance management of PE project investments at home and abroad.The contents and methodologies of research are introduced,and the basic concepts of PE and performance management assessment system are explained,as well as the theoretical basis of BSC.In the case study section,the basic information,investment criteria,investment process,development plan,investment model and development history of a PE company(GX Found)are introduced.The problems existing in GX Found's investment projects are analyzed and summarized.On this basis,an investment project screening evaluation system based on BSC and strategic map is developed according to the characteristics and actual conditions of GX Found.As a first step,the primary and secondary indices are selected by utilizing expert opinions.Meanwhile,weights of the selected indices are derived via the analytic hierarchy process to establish a BSC-based screening system of investment projects.Lastly,assessment target values are set up in the system for classification among various companies.The relevant data of companies actually surveyed by GX Found are imported into the designed screening system for computational analysis to derive results.Furthermore,the screening system is applied to the subsequent project appraisal,thereby enabling the PE institution to reasonably arrange the proactive screening,interim supervision and exit matters for project investors,and helping the PE institution and project investors realize a win-win situation.