Speed Up Investment Under The Epidemic 40%: How Does Yida Build Strategic Core Assets?

In the face of the sudden outbreak, many venture capital agencies slowed the pace of investment. But for Nanjing based Yida capital, the opposite is true.

Recently, the chairman and founder partner of Yida capital, Wen Lu, told the twenty-first Century economic report during the fourteenth China investment annual meeting annual summit that the number of projects voted in the first half of the year even increased by 40%. At the same time, Yida capital has completed nearly 5 billion yuan of new fund-raising.

Betting on technological innovation, but vigilance in investing in semiconductor overheating.

It is understood that in the past two years, Yida capital has invested 2/3 in 14 key technological innovation areas, including high-end equipment manufacturing, semiconductor, new materials, 5G communications, information security, life sciences and so on. Most of the projects voted in the first half of this year belong to the field of technological innovation.

"The enterprises in these fields may not be well-known, but they are" small giants "and" invisible champions "in the subdivision industry. They are also the strategic core assets of Yida. Ying Wenlu said.

When investing in these enterprises, the logic of investment has changed quietly. Originally, when looking at projects, RMB funds generally paid more attention to the profits of enterprises and whether they met the standards and requirements of A share listing. But now, when investing in technological innovation enterprises, more depends on the sustainable competitiveness of enterprises and the real R & D investment. "Only technology can bring sustained competitiveness and moat." He said.

In the first half of the year, the semiconductor industry, which is a hot investment area, should be informed that the semiconductor industry was basically in the state of no one after two and a half years ago. Because the core technology, core products, key components and equipment in the industry are mainly dependent on imports, and the annual import volume is about US $300 billion. Now the international situation has changed dramatically, forcing everyone to rely on their own efforts. There are opportunities for independent control and import substitution in the industry, and the market space is very large.

However, in the view of Wen Lu, some of the semiconductor star projects that surfaced have already had the phenomenon of "high fever". In addition, some of the early innovative enterprises in the process of development are less valued. For investment institutions, early investment, small investment, high investment and dedicated investment are the choices that can be taken.

"At present, in addition to the high valuation of semiconductor and biomedicine projects, other industries have generally returned to reason. In order to reduce the valuation of some enterprises in order to get financing as soon as possible, some enterprises also have the opportunity to find a leak. As a result, it will choose to accelerate investment in the second half of the year. He said.

Beyond the field of technological innovation, Yida capital is also concerned about investment in consumer services and real estate. Twenty-first Century economic news reporter noted that in June 3rd, IDA capital has just completed tens of millions of yuan investment in spring and snow foods.

"There is a huge market space for the consumer service industry." Ying Wen Lu said. But most enterprises will become "denominator", and few "molecules" can come out. For Yida capital, the field of consumer service is also concerned about enterprise innovation and advanced technology application.

Appeal for long-term funding to support technological innovation

At present, the fund-raising market is still facing difficulties. In the first quarter of 2020, in the first quarter of 2020, the VC/PE fundraising market, which was affected by the epidemic, was hit hard by the capital cold winter background. 471 new funds were set up, a year-on-year decrease of 26% and a sharp drop of 56%. At the same time, only 343 institutions completed the establishment of the new fund, a drop of 53%.

"2020 is the watershed of venture capital industry, and industry shuffling is accelerating. Especially under the impact of the epidemic, the power of the head will be stronger, and the institutions below the waist will be very uncomfortable. The industry will further differentiate. Ying Wenlu said. Now many institutions have no funds and difficult to continue, the advantages of the head institutions are more prominent. Similar to the US market, the head office has been growing for almost 20 years.

It is understood that in the first half of the year, Yida capital has completed nearly 5 billion yuan in fund-raising. Turning to the current fund-raising environment for RMB funds, Wen Lu said that China's mainstream LP can be roughly divided into three categories: first, high net worth individuals; two, companies represented by listed companies; and three, government guided funds.

The main demand of personal LP is return on investment. Enterprises do LP on the one hand in return, and on the other hand obtain resources from the industry. The government does LP to attract investment through equity bonds, increase taxes and employment, and drive the development of regional economy and industry.

"Good funds are managed and good institutions are managed. From fundraising to asset allocation, LP relationship maintenance, post investment management, every link needs to be put in place. Any link is out of step, and the survival of the organization will have problems. He said.

At the same time, analogous to the US market, its VC/PE industry has a very long term source of funds. LP is dominated by sovereign wealth funds, pension funds, family wealth funds and university funds. The LP structure of China and the United States is completely different. The composition of fund LP actually limits the longer cycle and more sustained investment in innovative enterprises.

Ying Wenlu believes that the biggest problem facing the development of China's VC/PE industry is the lack of investment in mainstream pillar funds, and the faucets of funds are stuck. For example, the new regulations of asset management should be improved, venture capital contribution and bank financing subsidiary investment are all restricted by various restrictions. We look forward to relaxing the restrictions on capital inflow of innovative capital as soon as possible, and increasing the pipeline of venture capital fund to help build a strategic core asset with technology as its fulcrum.

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