Distinguished guests, ladies and gentlemen,
Good afternoon!
I’m honored to attend the 19th China Venture Capital & Private Equity Forum. Over the past 19 years, the forum has not only been a feast for the exchange and clash of ideas of the venture capital/private equity (VC/PE) industry, but also an investment & financing platform that provides service for innovation and entrepreneurship. To serve and support innovation and entrepreneurship is the mission and responsibility of Shenzhen Stock Exchange (SZSE). Of the nearly 2000 listed companies on the SZSE, more than 70 percent are hi-tech enterprises. Particularly on the ChiNext Market, as many as 93 percent of listed companies are hi-tech businesses. SZSE has become a gathering place of China’s new economy and the ideal listing venue for technological innovation-based enterprises.
As a crucial component of the multi-tiered capital market, the VC/PE industry is the upstream of stock exchanges. For years, SZSE and VC/PE industry have supported each other, grown together and continuously deepened cooperation. As the source of seed capital for many start-up businesses, VC/PEs have delivered a great number of high-quality innovative enterprises to SZSE. Meanwhile, the SME Board and ChiNext Market of SZSE provide a key exit channel for VC/PE, facilitating the realization of capital growth and a new round of investment cycle. The normalization of IPOs makes such investment cycle more efficient. By May this year, of the 639 companies listed on the ChiNext Market, 397 companies or 62 percent have benefited from the support of VC/PE with the total initial capital topping RMB 22 billion. In recent years, in order to further extend SZSE’s service chains, we have also launched the ‘Technology Small-and-medium Enterprises Growth Route Plan 2.0’ (Tech 2.0) jointly with the Ministry of Science and Technology. The Tech 2.0 has been well received by VC/PE institutions. After more than two years of operation, we have initially created a technological innovative enterprises-oriented national investment & financing platform. The platform has gathered more than 4000 VC/PEs and other investment institutions and more than 9000 professional investors, providing non-profit, open and online/face-to-tace services for investors and start-ups. Based on success of the Tech 2.0, SZSE and 20 leading VC/PE institutions founded the “Firestone Spark VC/PE Investment Coalition” (the Coalition) in April this year. All these initiatives have deepened our cooperation with VC/PE institutions, facilitated the rapid formation, concentration and cycling of innovation capital and increased the service depth of the multi-capital market to innovative enterprises.
The VC/PE is a kind of “incubator” that bolsters the development of enterprises, a “propeller” that drives supply-side structural reforms and also a “catalyst” that sparks private investment. Domestic and international experience shows that the set of mechanisms jointly created by VC/PEs and the capital market for the discovery, screening and supporting of business opportunities continuously pushes forward the invention of new technologies, the growth of new industries and the emergence of new business models. They are also of great importance for developing new momentum for economic growth and advancing economic transformation and upgrading. Just as an ancient poem goes: “When autumn’s golden wind embraces dew of jades, all the love scenes on earth fade,” capital and technology will bring about numerous miracles once they combine. In September last year, the State Council released the Several Opinions on Promoting the Sustained and Sound Development of Venture Capital, setting out specific requirements on enhancing the exit mechanism, optimizing the market environment and improving the service system for VC/PE. SZSE will earnestly implement these requirements and carry out new development concepts in light of our own characteristics. We will focus on innovation-driven development and mass entrepreneurship and innovation, provide active services for VC/PE institutions, try to create a capital market ecosystem that supports entrepreneurship and innovation, and build the SZSE into a world-leading innovation capital formation center.
Firstly, SZSE will deepen reforms of the ChiNext Market and improve its abilities to serve innovation and entrepreneurship. The ChiNext Market is the gathering place of hi-tech enterprises in China. We will take initiatives to adapt ourselves to the new trends of innovation and entrepreneurship and the new needs for industrial adjustment and upgrading. We will continue to enhance the inclusiveness of the ChiNext Market, step up support for hi-tech start-ups, and extend the ChiNext Market’s service to frontiers of the hi-tech industry and the stage at which innovative businesses are most in need of the capital market, giving full play to the supporting and guiding role of the ChiNext Market for innovation and entrepreneurship. Meanwhile, we will try to facilitate the connection between VC/PE and the multi-tiered capital market and guide VC/PE to invest more in technological and innovative enterprises.
Secondly, SZSE will support the construction of VC/PE ecosphere by making use of the SZSE platform. In recent years, there have been more and more types of VC/PE funds and the participants have become increasingly diverse. Governments, financial institutions, listed companies and high net worth individuals have participated in VC/PE in various ways. It has always been one of our priorities to provide high-quality services and support for these different types of VC/PE. The Coalition recently launched by SZSE precisely aimed to strengthen interaction and cooperation between VC/PE institutions and entrepreneurs, creating a VC/PE ecosphere for sharing of resources, exchange of information and win-win cooperation. Based on the the “Tech 2.0” and the Coalition, SZSE will give full play to its advantages in professional strength, platform and information, combine its innovation capital formation center with the VC/PE ecosphere, and work together with VC/PE institutions to create China’s innovation capital ecosystem, jointly contributing to the development of innovation and entrepreneurship in China.
Thirdly, SZSE will strengthen the cooperation and boost the sound development of the VC/PE industry. Professional VC/PEs not only provide funding support, but also offer an array of value-added services for start-up enterprises, including sound corporate governance, professional legal and financial consulting services and high-quality integration of strategic resources. The soundness of operation and incubation abilities of VC/PE directly influences the quality of listed companies, the sound development of the capital market and further the capability of the capital market to serve the real economy. SZSE will make every effort to help VC/PE institutions improve their capabilities in using the capital market properly, support VC/PE institutions in establishing credit systems and self-regulatory mechanisms, facilitate the sound development of the VC/PE industry and maintain a favorable market environment for VC/PE.
Entrepreneurship, innovation, VC/PE institutions and the ChiNext Market are all integral parts of a unity by nature. SZSE and the VC/PE industry are closely related. We hope that SZSE and the VC/PE industry come even closer so as to give better support to the construction of an innovative China.
Finally, I warmly welcome your visit to SZSE. Wish the VC/PE industry prosperity and the forum a great success. Thank you.