Private equity funds like enterprises to have a simple business model and unique core competitiveness, and the enterprise management team has strong expansion ability and management quality. However, private equity funds still have a strong industry preference. The following industries are the favorite investments of funds in the past five years. Here, I will tell you the basic objectives of private equity investment:

1, TMT: online games, e-commerce, vertical portal, digital animation, mobile wireless value-added, electronic payment, 3G, RFID, new media, video, SNS;

2. New service industries: financial outsourcing, software, modern logistics, brand and channel operation, translation, film industry, TV shopping and mail order;

3. High-growth chain industries: catering, education and training, dentistry, health care, supermarket retail, pharmacy, cosmetics sales, sports, clothing, shoes and economy hotels;

4. Clean energy and environmental protection: solar energy, wind energy, biomass energy, new energy vehicles, batteries, energy-saving buildings, water treatment and waste gas treatment;

5. Biomedicine and medical equipment;

6, 4 trillion beneficiary industries: high-speed rail, cement, special equipment, etc.

Read more about the introduction of private equity investment funds

Private equity funds generally refer to funds engaged in private equity (shares of unlisted companies) investment. Private placement is relative to public offering. At present, all funds in our country are raised through public offering, which is called Public Offering of Fund. If a fund does not go through public offering, but raises funds for specific targets in private, it is called a private equity fund.

Characteristics of private equity investment funds

(1) Private equity funds, but the channels are broad

The scope of private equity funds is narrower than that of Public Offering of Fund, but all of them are institutions or individuals with strong capital strength and high quality of capital composition, which makes the funds raised not necessarily inferior to Public Offering of Fund in quality and quantity. It can be an individual investor or an institutional investor.

(2) Equity investment, but with flexible methods

Apart from simple equity investment, there have been disguised equity investment methods (such as convertible bonds or corporate bonds with warrants) and combined investment methods with equity investment as the mainstay and creditor's rights investment as the supplement. These methods are a great progress of private equity in investment tools and investment methods in recent years. Although equity investment is the main investment method of private equity investment funds, its dominant position will not be easily shaken, but the rise of various investment methods and the combined use of various investment tools have also formed an irresistible trend.

(3) the risk is high, but the return is rich

The risk of private equity investment first stems from its relatively long investment cycle. Therefore, if private equity funds want to make profits, they must make some efforts, not only to meet the financing needs of enterprises, but also to bring benefits to enterprises, which is bound to be a long-term process. Moreover, the high cost of private equity investment also increases the risk of private equity investment. In addition, the investment risk of private equity funds is high, which is also related to the poor liquidity of equity investment. Unlike securities investment, equity investment can be bought and sold directly in the secondary market, and its exit channels are limited, and the limited exit channels may not be smooth in a specific region or at a specific time. Generally speaking, after PE successfully exits an invested company, its profit may be 3~5 times, while in China, this figure may be 21~31 times. High returns induce huge capital to continuously flood into PE market.

(4) Participate in management, but do not control the enterprise

Generally speaking, there is a professional fund management team in private equity funds, with rich management experience and market operation experience, which can help enterprises to formulate development strategies to meet market demand and improve their operation and management. However, private equity investors only participate in enterprise management, not control the enterprise.