Tuesday, July 13, 2010

Liu: a play from the acting to the private equity fund non-plague


Liu was asked, do after retirement, he said, is willing to do a happy old man.

However, now he can not easily, because he PE investment in this new stage to perform the play was in full swing.

Guided by the actor to play

Industry to the capital from changes in the operation done, there are three factors contributed to the changes Liu: industry, environment, social environment and their own.

Yan Liu from the second line has its own age factor into account. He said that to do IT on the growth of new knowledge, demanding, and therefore the power to gradually feel incompetent, to the late 90s of last century, Lenovo has gradually improved, and felt that they should pull out early.

In fact, for two reasons to consider, Liu struggle trying to adjust the new aids to navigation: First, high risk IT areas, only two IT companies is not very safe; Second, the funds have not been to maximize shareholder application.

In 2000, Liu set up Legend Capital, a small IT companies to do private equity venture capital fund. Legend Capital is only the first 35 million U.S. dollars of funds in 2003, the second phase of fund raising 73 million U.S. dollars; by the end of 2006 a third of fund size of 1.7 million, funded 50% of Legend Holdings.

Liu initially entered the field of private equity is not thinking out of IT, the establishment of Legend Capital is only through their relationship in the IT industry, with its own Lenovo from small to big experience, to find new profits.

During the same period by the impact of surging domestic real estate, Liu set up the real estate company Raycom. The company in Wuhan, Chongqing, Beijing, Changsha, Tianjin, total access to 2.8 million square meters of land, residential contract sales exceeded 2.3 billion.

However, Hony Capital was established in 2003 to enter the industry, it really opened up a vast Liu investment space. Hony Capital Group, soon to purchase bad assets of the Bank of China, glass, package and promote Hong Kong-listed their reputation. Hony Capital currently manages more than 5.5 billion yuan of funds, has invested more than 3.2 billion yuan was invested enterprises had total assets of 14.3 billion, was invested enterprises in 2006 the overall sales of 100 billion yuan, total profit and tax of close to 1.3 billion.

In response, Liu said that as China's consumption has entered a new space for development, once considered a sunset industry, steel, textile re-valued; the same time, in these traditional industries, there were two opportunities: First, private enterprises percentage points increase in volume and weight, the sharp rise in exports, one state-owned enterprise reform; This PE investment really make a difference in the space provided.

Liu like to use "out of the screen to see art," to sum up their own changes. He said the operation made the difference between industrial and capital like a show on the (actor) and going to the cinema (directors) of the difference. "Doing business in the acting, the investment is to allow people to see them. For example, directors must consider why the young people do not like opera, or not to accelerate the pace of investment if the doing in this perspective, it is convenient, because he will stand A further point of view; and people acting on the bar inside, only to note whether the audience applauded. investments, have a better macro-concept, standing in a theater point of view, or perspective beyond to consider the issue. "

Appreciating use

To enter the IT industry, Liu to face a more familiar environment wider, and his private equity fund has achieved a spectacular record. He said that this phase should be attributed to their good people, good employment.

Liu said: "Lenovo's business in China, there is little or commendable, is not only made a good business, but also brought out the people."

Liu and his employer the ability to see the investment used. He said the investment is mainly to do four things: raise money, select projects to help grow profitable exit. Overseas, the private equity fund of "financial expertise" on a very prominent position, to how to design a transaction structure very seriously. His selection of projects and the Man on the first place there is in Man insights, only to investment in Legend Holdings favorable weather.

Hony Capital in 2005 to help China successfully listed in Hong Kong of glass. Prior to the Hony investment in China Glass (formerly Jiangsu Glass Group) is a Debt to Equity. Hony Capital Through investigation, that the glass industry is still bright future, but the leadership of Jiangsu Glass also has the ability to lead business team to move forward, but the current institutional environment needs to be improved. Liu proved the human judgments are correct. Liu said that at that time "to see if they were okay before they vote."

Liu Man have emerged from the experience of Lenovo. He spent much time in the association management effort to summarize the law of how to build teams, set strategy and lead the teams. Lenovo has a complex set of systems, after the end of each combat, the project leader of the campaign wrap-up session will be convened to conduct complex disk, recap, lessons learned. With this approach, he cultivated his talents to ensure the implementation of their strategic forces, but also find ways of Man.

He said to think of the lessons learned, to observe the current CEO is the right investment enterprises, who can see clearly before the eyes of how far, can not only see the top-level management structure, there are a sufficient basis for management experience and so on.

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