Multi-case Study On Investment And Exit Method Of Private Equity Funds

Over the past decade,when private equity investment institutions around the world flocked to China,China's local private equity investment institutions have been on the fast trackand become an indispensable and important force in the capital market.By the end of December 2018,There are more than 14,000 private equity and venture capital fund managers had registered in China Securities Investment Fund Industry,with a fund size of nearly 8 trillion Yuan.Faced with the reducing macro-level solution of financial risks,strong financial supervision,the new stage of policy-related industry supervision and self-regulation,the micro-level market changes and the intensification of competition among private equity investment institutions is more intense,private equity investment institutions in China are constantly improving themselves.Big Billows Beat The Sands meanwhile sift the true from the false,The head-effect of China's private equity investment institutions is becoming more and more obvious,and the Pareto Principle(or the 80-20 rule)is further manifested in China's private equity investment market in 2018.Under the background of capital-shortage and project-shortage,head institutions come to the fore among many private equity investment institutions,and are favored by capital and project parties.At present,the success-rate of investment and exit has become the key index to measure a private equity investment institution.Good performance,rich resources and excellent reputation have become the goal of all private equity investment institutions to pursue and develop.On the basis of the research on the theory of private equity investment,this paper compares the theoretical research results of domestic and foreign private equity investment-ways and exit-ways,and summarizes the characteristics of private equity investment funds.This paper analyses the current situation and problems of private equity investment industry in China.Subsequently,this paper uses multi-case analysis method by listing three investment projectsfrom TC Asset Management Company,these projects are in different life cycles of growth-stage,expansion-stage and maturity-stage.SWOT analysis method is used to analyze the strengths,weaknesses,opportunities and threats of the project.The investment logic of the projectsare analyzed from three dimensions: macro level,industry level and enterprise level.This paper expounds the investment structure,analyses the investment returns and the choice of exit modes,puts forward the enlightenment of each investment case,and points out the key elements behind the investment decision-making.In the conclusion part,the article summarizes the nine elements model of private equity “invest and exit” by inductive method: private equity should pay attention to the monopoly of the invested enterprise in the industry,the unique competitive advantage,the complementarity of the industrial chain,the invested enterprise's leadership of the head organization and the influence of the founder and the core team.The withdrawal factor model is the "three trends " factor: considering the macro trend,cost advantage and development trend.With the establishment of the model,this paper puts forward some suggestions on how to do a good job of private equity investment and withdrawal under the background of strong financial supervision,such as changing from pure financial investment to "combining financial investment with strategic investment",participating in joint investment appropriately,and giving diversified empowerment to the invested enterprises by investment institutions,etc.