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Characteristics of private equity investment (PE): From the perspective of investment methods, it refers to equity investment in private enterprises, that is, non-listed companies, through private placement. During the implementation of the transaction, the future exit mechanism is taken into consideration, that is, selling holdings for profit through listing, mergers and acquisitions, or management buybacks.

The different sources of private equity (PE) funds will affect the structure and management style of investment funds. This is because different funds require different investment objectives and strategies, and have different risk tolerance.

The main characteristics of private equity (PE) include but are not limited to the following:

Investment institutions often adopt the limited partnership system, which is a form of corporate organization that has good investment management efficiency and avoids the problem of double taxation.

Exit channels are diversified, including but not limited to: IPO, mergers and acquisitions, buybacks, etc.

They prefer established enterprises that have reached a certain scale and have stable cash flow, and are non-listed companies.

In terms of fund raising, it is mainly raised through non-public means from a small number of institutional investors or individuals. Its sales and redemption are conducted by the fund manager through private negotiations with investors.

The investment period is relatively long, generally up to 3 to 5 years or longer, and is a medium- to long-term investment.

The private equity investment operation process includes but is not limited to: project search and project evaluation; investment decision-making; investment management; and investment exit.