during the strategic adjustment period, who will “speed up” the venture capital market?
2024-09-10
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after the global economy has experienced a series of turbulence and uncertainty, my country's venture capital market is facing an unprecedented period of strategic adjustment.
the "annual white paper on venture capital industry (2024)" shows that in terms of fundraising, there will be 8,322 newly established funds in china's venture capital/private equity (vc/pe) market in 2023, a year-on-year decrease of 4.7%. the number of funds has fallen again, but the decline has slowed down. in terms of investment, a total of 8,534 investment and financing events were disclosed in the domestic venture capital market in 2023, a decrease of 12% from 2022; the total amount of financing was us$167.5 billion, an increase of 8% from 2022.
after entering 2024, the venture capital market has shown the following phenomena, namely, the venture capital team has shrunk, the market has changed from "projects looking for funds" to "funds looking for projects", venture capital "lacks long-term money" and "has no rice to cook", the problem of "obstruction" of patient capital needs to be solved, and startups are frequently asked to repurchase.
so, what role should financial institutions play in supporting venture capital?
professor of the zhengzhou training institute of the people's bank of china,researcherwang yongtell the financial times reporter that first, banking institutions should play the role of technology credit providers, increase credit loan issuance on the basis of risk prevention and control, comprehensively use enterprise innovation points and other multi-party information, develop risk sharing and compensation loans, and strive to increase the "first loan rate" of technology-based enterprises. secondly, insurance institutions should play the role of long-term capital investors and promote more funds to invest early, small and technology. thirdly, trust institutions should play the role of technology trust service providers, take multiple measures to improve the "gold content" of trust services for technological innovation, respect the development laws of technology industries and technology companies, and allocate strategic resources around the entire life cycle of technological innovation and industrial upgrading, combined with their own resource endowments, and formulate a roadmap for the investment and business transformation implementation plan of new industry trusts. finally, securities institutions should play the role of capital market intermediaries, ensure that the information on the scientific and technological innovation attributes of enterprises is true, accurate and complete in the process of due diligence and performance of sponsorship responsibilities, screen out truly "hard technology" enterprises, actively guide capital flows to "hard technology" enterprises, and "guard the door" for the capital market to keep problematic enterprises out of the market.
it is worth mentioning that on june 19, the general office of the state council issued the "several policy measures to promote the high-quality development of venture capital" (hereinafter referred to as the "policy measures"). the issuance and implementation of the "policy measures" has played an important policy support role in accelerating the strategic adjustment period of venture capital institutions. data shows that the direct investment activity of local state-owned institutions is rising against the trend. at the municipal level, a government-guided fund system with angel funds, industrial funds, venture capital guidance funds, and science and technology innovation funds as the matrix has been created to support enterprises at different stages of development.
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