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New fund was reduced by 20%, and 562 funds raised 140.8 billion US dollars
Due to stricter regulations, the difficulty of establishing private equity investment funds has gradually increased. In 2019, the number of newly registered funds has been reduced by 20% from the previous month, and the willingness of institutions to establish new funds has weakened. In terms of geographical distribution, with the encouragement and support of policies, the Shenzhen area of Guangdong stands out and has become the region with the largest number of private equity funds in the country.
Affected by policies such as domestic financial deleveraging, obstruction of bank fundraising channels, and stricter supervision, the fundraising cycle has been extended, making RMB fundraising difficult. In contrast, the US dollar fund is less affected, the market has higher expectations of the US dollar fund, and it has more confidence. Many institutions have begun to raise US dollar funds.
The institution’s willingness to establish a new fund weakens
From the trend in recent years, the number of newly established funds has soared since 2015, with an increase of up to 116%. Due to the tightening of capital market regulations, the number of newly registered funds has shrunk after 2017. And there is a clear trend of expansion.
A similar trend is occurring in the number of institutions completing the establishment of new funds. After 2017, due to the tightening of the fund end, fund raising has become increasingly difficult, and some institutions still have unfinished fundraising, and their willingness to establish new funds has also weakened accordingly.
The number of newly established funds in the institution is polarizing
In 2019, a total of 3,332 funds were newly established by 1891 institutions, of which only 17 institutions with 10 or more funds were newly established and 1302 institutions with only 1 new fund. Most of the newly established funds are head institutions or institutions with government background.
In the context of the capital winter, most small and medium-sized institutions have reduced or stagnated the establishment of new funds, but head institutions such as Gao Capital, Sequoia China, or listed companies or governments such as Jingzhou Investment and Guangzhou Fund Institutions with backgrounds are still actively setting up private equity funds.
Shenzhen becomes the main gathering place for private equity asset allocation
In 2019, the newly established 3,332 funds are distributed in 30 regions. Among them, with the support and promotion of policies, 1046 funds have been newly established in Guangdong Province, of which 540 funds have been newly established in Shenzhen, which is a strong leader in the country.
Early in 2019, Shenzhen issued “Several Measures to Promote the Development of the Venture Capital Industry” to encourage the municipal government to guide funds, state-owned enterprises, specialized venture capital institutions, angel investments, financial institutions and other entities to enter the venture capital industry, by enriching venture capital entities Realize the agglomeration of venture capital, innovate the method of raising funds for venture capital, broaden the channel of funding sources, and solve the problem of difficult fundraising in the development of venture capital industry. At present, Shenzhen has gradually become the main gathering place for private equity asset allocation in China.
562 funds have been raised, raising a total of US $ 140.8 billion
The new rules of asset management in 2019 are effective, banks and other funds continue to tighten, LP strengthens consideration of institutional performance, and is more discerning in the selection of GPs, leading to an increase in the fundraising cycle of funds and an expected reduction in the scale of fundraising It is difficult for the fund raising to continue to deepen. In 2019, a total of 562 funds were raised, with a total size of 140.823 billion US dollars. The number of funds and the general rules for fundraisingThe model has decreased significantly compared to 2018, and the total fundraising in 2019 mainly comes from the large fundraising of the head institutions. The fund’s top 10 funds raised a total of about 62 billion US dollars, accounting for 44% of the total fundraising. Battlefield head effects have intensified.
Due to the investment and retreat advantages of the US dollar fund currency, the market is relatively more confident in the US dollar fund. In 2019, the average value of US dollar fundraising is (US $ 878 million ) Much more than RMB funds (US $ 189 million) , some Chinese-funded institutions have also started to raise US dollar funds. It can be seen from the top 10 fund raising scales in 2019 that 7 of them are US dollar funds, and large amount of US dollar funds are emerging endlessly.
The fundraising is completed Top10
The investment activity of VC / PE institutions has cooled down, and the number of shots has decreased by nearly 30%.
The capital tide is ebbing in 2019, and the investment activities of VC / PE institutions have cooled down significantly. The number of participating institutions has decreased by nearly 30% compared with 2018. In the environment of insufficient investment in ammunition and expensive project costs, institutions generally slow down the pace of investment. Even the head institutions have increased their consideration of the project’s business model and financial data, reduced the number of shots, and committed to investing in fine investment.
Institute slows down the pace of investment, and strives to invest in fine investment
Affected by difficulties in fundraising, expensive investment, and difficulty in exiting, some institutional funds have not yet been raised, and there is a lack of sustainable investment ammunition. More institutions choose to wait and see. Some small institutions are even unable to continue to announce their dissolution, so they will participate in 2019. The number of VC / PE institutions for investment activities has decreased significantly.
Of the participating institutions, 2,923 (62.86%) Only 16 companies have invested, and only 16 institutions have invested more than 30 (0.34%) . The institutions that are more active in investment are mainly head institutions and national team institutions with government or listed company backgrounds. Most institutions have only invested 1 or have not participated in investment.
VC / PE active investment institution Top10
Inventory the top 10 most active investment institutions in 2019, Shenzhen Venture Capital won the top prize with 127 cases, and Sequoia China ranked second with 106 cases.
Under the environment of insufficient investment in ammunition and expensive project costs, even the head institutions generally slow down their investment rhythm. In 2019, the top 10 active investment institutions have reduced the number of investments compared to the previous two years. Institutions generally have a rational and cautious investment attitude towards investment, and put more energy on post-investment management and project resource services of past investment projects.
The number of venture capital transactions is almost cut, and early investment is ebb.
Due to the sudden tightening of the asset side in 2018, the active venture capital market has gradually entered the cold winter. The VC / PE investment market is facing a reshuffle in the industry and has entered a period of callback. Under the environment of insufficient investment in ammunition and expensive project costs Both head institutions and small and medium-sized institutions are slowing down their investment rhythms, adopting a rational and prudent investment attitude towards projects, focusing more on post-investment management and project resource services of previous investment projects, focusing on thinking The future investment track of the fund.
The venture capital market has fully entered the callback period
Since 2015, the venture capital market has experienced irrational prosperity for several years, and there are endless hotspots and outlets. After entering 2019, the Chinese venture capital market has fully entered a callback period, and the overall investment rhythm of the industry has slowed down and returned from rapid development The normal state. Compared with 2018, the number of venture capital transactions is almost cut, a drop of up to 48.05%, and the total transaction amount has plummeted by 44.51%.
From the perspective of average investment value, except for a small fall in 2017, the average investment value has almost climbed since 2014, and the average investment value in 2019 has reached 10.12 million US dollars. The increasing average value of investment is mainly due to the gradual reduction of irrational investment by institutions, the investment stage shifts to the growth period, the return to the origin of value investment in the selection of projects, and the large number of transactions are emerging endlessly.
Significantly reduced early investment, shifted after the investment stage
From the perspective of the venture capital market segmentation round, in the past three years, the number of seed rounds and angel round transactions in the initial stage has gradually decreased year by year in all trading rounds, among which the angel round investment has dropped significantly. 37% of the total fell to 18% this year, a range of 51.35%; in contrast, the number of rounds of A / B / C round investment has increased year by year, especially the round A investment has increased significantly. The early angel institutions began to withdraw or the overall investment phase shifted backwards.
Financing by industry segment
In 2019, the investment hotspots of China’s venture capital market are concentrated in the fields of IT and information technology, the Internet, and medical and health, as follows:
① Number of financing: IT and informatization financing are the most active, with a total of 808 cases.
② Financing scale: The Internet has become a key gold absorption industry, with a total financing scale of US $ 10.488 billion.
③ Mean financing: Although the number of cases in the automotive industry is only 107, the top star companies frequently have large-scale financing, with an average financing value of 35.248 million USD.
Key financing cases in the venture capital market
In 2019, large-scale financing of the automotive industry is frequent, the largest of which is-Weimar Automobile completed a total of 3 billion yuan in Series C financing, led by Baidu Group, Taihang Industrial Fund, linear capital, etc. Investment, this round of financing will be mainly used for user experience and technology research and development. As of now, Weimar Automobile’s cumulative financing amount has reached nearly 23 billion yuan. After this round of financing, Weimar’s valuation is expected to be further improved.
The trend of the private equity market is down, and the number of cases has dropped by more than 30%
In 2019, the development trend of China’s private equity investment market has generally declined, and its activity has fallen by over 30% compared with 2018. However, in a tighter macro environment, the private equity market is more stable than the venture capital market.
The private equity investment market is relatively more stable
Over the past few years, the development of China’s private equity investment market has been more stable than that of the venture capital market. In 2019, although the number of transactions in private equity investment affected by the cold winter of capital has declined, compared with the situation in which the venture capital market is cut, its fluctuations are within a reasonable and controllable range. There were 2,189 private equity transactions in 2019, a decrease of 31.55% compared to 2018, and the transaction size was 107.316 billion US dollars, a 26.82% decrease compared to 2018.
From the perspective of the average investment value, there is no obvious trend change in the average value of China ’s private equity investment. Except for 2016, the average investment value is basically stable in the range of 40 to 60 million US dollars. control.
Financing Situation in the Private Equity Market Segmentation
In 2019, the financing situation in China’s private equity market segment is as follows:
① Financing volume: The most active financing transactions in the manufacturing industry, with a total of 422 cases
② Financing scale: Internet attracts a lot of attentionGold, with a total financing size of US $ 164.236 billion
③ Mean financing: Living services, transportation and logistics, and the automotive industry are now large financing transactions, with an average financing value exceeding US $ 100 million.
Private equity market key financing case
In 2019, in the Chinese private equity investment market, the automotive industry performed well. In the top 10 cases of financing scale, three automotive industry projects were on the list. These include a $ 1.5 billion round D financing of used car trading platform Guazi, a $ 380 million D + round of auto parts maker Kangzhong Auto Parts, and a 2.5 billion yuan strategic financing of new energy vehicle manufacturer Bojun Auto.
Data description
For the convenience of readers, the data in the report is now explained
Statistical caliber:
Newly established funds: within the statistical period, newly incorporated funds
Complete fundraising: within the statistical period, announced the completion of fundraising
Venture Capital / Venture Capital: Seeds in Financing RoundIt’s the C round (including C + round) Investment
Private equity investment: financing round is in round D and later (including round D) investment
Financing scale: statistics the actual amount publicly disclosed in the market, estimates the amount of undisclosed specific values and incorporates it into statistics
Exchange rate conversion:
All the fundraising scales and investment scales in the report are based on the exchange rate on the day of fundraising or investment, and are converted into US dollars for statistics.
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