Venture Capital_ Venture Capital barriers by fdjerue7eeu


									Venture Capital, Venture Capital barriers
This article is by Professor Li Yining of Beijing University Venture Capital
International Forum on the summary statement, investment
business by the order
Venture To this land in China to carry out successful, we must eliminate so several
obstacles in terms of ideology. If you do not remove ideological barriers, then the
cause is difficult in China.
Ideological obstacles what is it? One is that some people take too much money. If you
take too much money that would
May cause huge revenue gap. Is that if you start with the way stock options, but also
shares with the way intellectual property, etc., would take too much money. Some
people make some comments on this issue, including if you look at some magazines,
some of the above often have this article that China is now the main problem is that
the income gap problem, polarization, etc.. Of course, this issue, nor is it can not
make some reference. But the main problem in China is still a egalitarian ideology.
Because China is a long time past, the economics of countries small farmers, and later
lived under the planned economic system for many years. Therefore, in the eyes of
ordinary people were always eating the same big pot that is where the superiority of
our socialism, and the best are almost all income levels. In fact, this is hampering the
development of the Chinese economy and hinder China's economic
reforms, but also hinder the development of China's venture capital
industry. We all know that egalitarianism is not socialism, eating the same big pot is
not socialism, not to mention eating a big pot pot meals has never been the problem. A
pot it? Never is.
Why before the Cultural Revolution, people generally feel in my heart balance? That
is because, at that time, I told the people around me, people I know, everyone in one
pot meal. I do not know to the outside pot still pot, the pot I do not know what it is to
eat, can not think I can go there as the pot go to eat. For example, Jiang Qing Gang of
Four, they live in the Diaoyutai, they eat that pot is something you do not know. And
other Cultural Revolution is over, we come to realize that pot they eat those things
with us is completely different to eat. Why are we all know it was unbalanced? The
main thing that used to eat with me in a pot people eat today is not the same. We are a
street person, a person of the school, a village of people, past earnings are almost the
same level of income he sent under this big. The fish then become rich, and that
business prosperity for themselves, while their incomes increase much. This
psychological state is therefore very easy resurgence, but this psychological state of a
resurgence, it hindered reform in China, on the hinder China's development,
it is not much of venture capital.
So, I always say we must recognize the problem, is who is the beneficiary of venture
capital, the biggest beneficiaries are? Which in my book, it cited an article by Mr.
Zhang Yuyan, where talking about the two stories, quite interesting. Said is the story
of two students of Confucius, a Spring and Autumn Period, said that the State of Lu, a
provision that any State of Lu to travel abroad, see Lu were reduced to slavery, you
can Dianqian out of her redemption, redemption out of it, you can return to talk to the
Lu government reimbursement. Confucius had a student go abroad, and indeed to see
the State of Lu enslaved in a foreign country, and took back his redemption. But this
man does, and Lu did not return to reimbursement, so some people praise this
man's character how noble, how good are, how good the class. Confucius
knew this, they blame the students, that you are wrong. Others will wonder, how will
it wrong, this is not the good things? How to do good will is wrong? Confucius said,
you prevent this behavior more in foreign countries were reduced to slaves freed,
because you redeem the people, not to reimbursement. Others Dukua Hello, you
moral character. The other one go abroad, he saw another person become a slave state
of Lu, he must think I do not Dianqian pad in the end it came out ah his redemption? I
do not pad the money back reported reimbursement ah? I do not reimbursement of
money lost on wasted, I'm going to reimbursement, others are compared,
and a certain noble character, not reimbursement, this guy as good as him, you see,
this guy has to reimbursement! So he thought of them, he had concerns. He then
pretending not to see, he passed away from the side. This prevented more people
being rescued. This is a story.
The second story, a student of Confucius on the river walk, see a person fell into the
river which, being out in a torrent, was drowning. This time, his family members is
very rapid, called, life-saving. The students have shown selfless and jump off the
water, he was rescued. So family is very grateful to him, the heavy reward him.
Reward him what ah? To reward him a cow. But in the Spring and Autumn Period, a
cow is very valuable, the students very happy. Elated to holding this cow, from the
street to go home. People on the street on the argument: the this "Personal
saving is good, but the greedy heart, ah, someone else has given such a precious gift,
he dare to, how this person actually did not like." Confucius knew this , to
praise the student, that you do the right thing. Others say, how can that thing ah?
Confucius said, his behavior is tantamount to a declaration to the community, as long
as you take risks to save lives, then family members to a much higher reward, you can
take home the complacency. So it will encourage more people to save water, more
people will have greater chance of being rescued from distress. These two stories tell
us, we look at the problem, who should be the biggest beneficiaries from this
perspective. I came out of slavery and redemption, I went to reimbursement, I did not
lose anything. But the biggest beneficiaries of whom? Those who become slaves, they
want to be rescued. I go to save water, I had a cow, I got good, but the biggest
beneficiaries of whom? People who fell into the water, about to be drowned, they may
have a greater chance saved.
We pass out this problem, we can know that we are engaged in venture capital,
engaging in intellectual property shares, carry out stock options, in itself be a certain
advantage. But the greatest beneficiaries are? Is our country, our society, we boosted
the high-tech, up out of our economy, our foreign students return to start a business.
We pass this question in the social sense, we in the community resistance will be quite
small. So, I several times with other people on the outside, that is, those entrepreneurs,
inventors, I say, to the right of your assets should you give your money you should
take. You do not, others are embarrassed to. You say you want the money too much.
You go back and say Well first lead. Well you donate another year floods. The first
thing you have to first receive the money back, because this is what you deserve, you
can not do. This reason, we must speak through a so, so say pass up, our resistance
would be less ideological. So I say this is a problem for us in real life is sure to pay
attention to this issue.
The second question is what? This is the rich people on a secondary status, in fact,
developed to make a society, we must make the people rich, the people must be
allowed to hand money. People get rich, and what problems have been resolved. We
say that the breed should be more well-off homes. Do that to foster more well-off
families? Because the first point, well-off are most conducive to social stability, and
most conducive to social prosperity. The well-off concept is growing, do not put off
the old as a fixed concept. Today, we have what is called off. Should be referring to,
you have a home, the family has a TV, have called off a certain income. Maybe after
five years, the family have a car, called off the. Perhaps in another five years later, the
family has called off a second home. You this off the gratitude is constantly changing,
you are not that well on only one concept, say, 20 years ago, a lesbian who is wearing
a earring, who is wearing a ring, even luxury, and incredible the. Also today, who call
it a luxury ah? It has been used, it is not a luxury. Because the concept has changed.
For instance, in a few years ago was wiped point lipstick, this is called luxuries. Now
who else think so? So well-off society is changing the concept. Society the more
well-off family, our society's economic development, the better will be.
This can form a virtuous circle. Should be said that the Chinese economy is a broad
future. That dinner, an investment of Mr. North said, you think about it, 900 million
farmers add two coats per person per year, our fabric production is not enough. Add 1
square meters per person per house, we must add the number of square meters of the
country ah? Per person each to buy a car, it is the total number? Per person each to
buy a refrigerator, that number is? So the potential of Chinese market is constantly
open. This shows that, for investment in China, including engaging in venture capital,
venture capital, there is a great development prospects.
But the peasants should get rich. How can we engage in rich farmers do now? 15
program which talked about the very important point is to make farmers rich, must
follow the company plus farmer's such a road. Company plus farmers,
according to different situations throughout, can be divided into three different stages:
the first is called contract farming. Is an order to the farmers, under the order. Because
farmers are very isolated, he message is different, he did not know what kind of things
the market needs. Such as production of garlic, and other things out, the market has
not, and the production something else, it happens. Therefore, the farmers here, the
problem is difficult to do. How do? Allow the company to deal with this problem is
easy to handle, and you as I give you a contract, I am in the contract for what you
produce, such as garlic, I buy according to a certain price. This reassuring farmers out
of production, the company an order to you, by that time he will take away a good
price, which has carried out widespread. This can increase their income. But while the
contract farming has spread, there is also another two places, or inadequate. The first
inadequacy is the order of agriculture, the burden is too heavy on the company, as he
and a lot of farmers signed a contract when he acquired had a very large sum cost. His
car to an acquisition of a back and forth to and between each and every specification
may not be entirely the same, go back to how the process by following the need to, ah,
need to cost a lot of time. The second is that China's contract, ah, will be
set up though, but if the price is a price rise, farmers would not sell a company. He has
been market sell, not give company. On the other hand it, if the price of a down, the
company is not acquired by the original price, then legal proceedings, but a dozen in
this case requires a very long time, who can not solve. Therefore, the benefits of
contract farming has his, but also has his limitations. Therefore, it is now developed to
the second stage, the company plus farmers rent the second stage is called to operate.
Let me give an example, not long ago, Beijing University Guanghua School of
Management and Zhanjiang City, a strategic development plan is in Guangdong
Peninsula, he was there, despite the good weather, but there no rain, no rivers, so a no
less than rain, where he is a very arid land, low agricultural production is very low,
farmers throughout the year, only two 300 acre of land revenue. You said that the
farmers how rich ah? So farmers have to add the company to take the second stage,
Zhanjiang, many companies, including Taiwan, there are joint ventures, there are
township enterprises are joint-stock company, talk with the farmers there, you are not
an acre a year to only two or three hundred dollars of income? Well, you do kind of,
I'll give you three hundred dollars a year, you grant land to me. A farmer
would like to say, I do two or three hundred a year is income, and now the land is
rented out income 300, which is not on the line. The company even told farmers say
that you are willing to go out to work, you go working, you do not want to go to my
working on the farm to work, then I'll give you wages. Farmers say this
good, I can make more money up. Even as this piece of land, the company invested in,
the first wells, are all deep wells are irrigation, uniform specifications. I went to a
place to see, several acres of land, ah, kind of all pineapple, so face that place names
are all changed, changed its name name? Changed the sea called pineapple, because
there are all pineapple. This so, the income of farmers can be improved.
Last summer I went to Qinghai, in Qinghai there, one of our very talented students,
where the chairman of a department store to do. He said, Li teacher, you have come,
I'll take you to go take a look at our agricultural base. I say you engage in
Qinghai Department Store, is a public company ah, but also engaged in agriculture do?
He said that I was helping the poor. We do car from Xining to a county, to climbed
over a mountain, there are more than 3200 meters high, to the county. I got off and
saw my surprise, where the water is green green, the Yellow River water is clear. I say
this is how going on ah? He told me that the Yellow River in Qinghai is clear, and the
future of Qinghai, to the Loess Plateau on the yellow. He was there to talk with local
farmers, you can play each year, how much food? Also two hundred dollars, well,
I'll give you three hundred dollars an acre of land, land that I planted.
Qinghai working out because there are fewer ah, so I usually stay when in the local
workers in the. Kind of what? Kinds of vegetables, where the tomatoes, cucumber,
wax gourd are very, very big. Then, how should we do? Air Japan, where to advertise,
that it is green from the Qinghai-Tibet Plateau. This is a ready market in Japan, which
invigorated the. Also increased the income of farmers. Land rents, wages each month.
Qinghai Department Store speaking, we do not make money, earn money, who went?
The farmers earned. So, this is the second phase. But at this stage it, and now to die.
So, you have to go to the third phase.
Recently, Professor Dong dedicated to Zhejiang, Hubei, analysis, discovery has now
developed to the third phase. The third phase of the system called the stock field. That
shares the land. Because the land lease of land shares in another difference is that the
land lease, the rent is fixed. 300 dollars an acre of land is 300 dollars, can not change.
But the right to use land is different. Because the shares are on a monthly basis of
equity in dividends, that money better than the monthly rental to take less. Second,
companies in the development of his stock in the value-added. I few years later, my
options have been transferred, I have another chunk of cash. Therefore, the stock field
system now under development. Therefore, from the rental unit to operate to the
present field system is a leap in development. Therefore, China's
agriculture on that path, he can be developed, and agricultural income would be
increased. Increase the income of farmers, the rural market started. Start the rural
market, and our entire Chinese market started. The world's largest gold
mine where I said that in rural China. China's rural areas, if rich, you see
how big this market? Rights cars, construction matter, his sales are quite large. In
addition to the other, China is also implementing a system, called the land trust
system. This is that place in Zhejiang Shaoxing Rise. In that place, farmers go out for
work, and the land where the waste is not planted. Not planted, how do? Now there is
a way, I dedicated the land to the county a land trust agency to allow him to land the
next. He put the land to find someone to bell. Look what like? To find the city people,
find some willing to invest in rural areas to species, this, too, is venture capital right.
Although the money is not a lot, also then a few acres of land. He put all the
equipment, wells, irrigation, plastic sheds are out again. Moreover, he has such a
principle there, I went there personally to see it. Are the three words, people I have
not, that is, you do not, I have. I kind of things are you do not. The second is that we
have is better, if you do good, I have this on good quality, better than you. Others do
not have, people have is better, but if the superior people how to do? You are gifted
people, I season, I located better than you, my product or one month earlier than you,
or a month later than you, I always think of a way. This does take such an approach,
there is a large number of industrial and commercial approach to the Land Trust
contracted with large tracts of land.
In short, I must tell you is that we all have to the phenomenon of rural agriculture in
China to have a full confidence. As long as farmers get rich, we the Chinese market
started. So, you re-engage in venture capital will not neglect the high-tech agriculture,
which is also a great potential in the future part. This is the second point.
The third point is that we have a lot of places, we have been cutting trees up the
mountain, so to develop, and now this concept and the phenomenon is changing. Past
the old saying, call reflects environment Everyday by water draft. Ate forest by forest,
by eating places. This word is wrong by relying on is wrong. Now, many places have
changed him, they changed a word. Education hill to eat mountain, who raised
Chishui, the raising of forest food forest, and raised to eat to. The key is to keep.
Mountain, tree, light cut no, must certainly be a good support. Keep it better, then use
the whole of biological resources, pharmaceutical, or some other something? In this
way, this is a great venture investments. If the terms from these words, our potential is
enormous. As long as we work together, I am sure you can venture out on a new road,
new steps. In conclusion, I would say these words, thank you.

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