Formal financing process of investment company

Application method and processing flow

Application method:

(1), the involvement degree of investment and financing behavior: direct investment, indirect investment.

(2) Investment and financing applications: productive investment and financing applications and unproductive investment and financing applications.

(3) Investment and financing application methods: internal investment and financing application, external investment and financing application.

(4) Investment and financing contents: investment and financing of fixed assets, intangible assets, current assets, real estate, insurance, trust, etc.

Processing flow:

(1). The investment and financing handling enterprise shall submit the resolution of the board of directors and the application signed by the chairman to the examination and approval authority.

(2), the examination and approval authority after receiving the investment and financing application documents, make a written reply whether or not to agree.

(3), the examination and approval authority to review the application for investment and financing.

(4) After examination and approval by the examination and approval authority, the investment and financing enterprise shall apply to the administrative department for industry and commerce for registration of change in accordance with the relevant provisions on registration of change.

(5) Completion of investment and financing.

1, project screening

Generally speaking, angel investors will meet entrepreneurs in the office and listen to the entrepreneurial team's statements on their entrepreneurial ideas, project progress, development plans and capital needs. If there is enough time, angel investors also want to hear the work experience and entrepreneurial experience of entrepreneurs and the story of entrepreneurial team cooperation. Some angel investors will arrange the latter to talk in a more relaxed occasion. For example, talk about these light topics when eating together.

Through the meeting with entrepreneurs, investors can learn more information that is not in the business plan, such as whether the entrepreneurs of the enterprise have leadership and innovation ability, and whether they are good at managing the company (market, production, finance and management, etc.). ).

2. Due diligence

After investors meet entrepreneurs, if the two sides reach a preliminary understanding or agreement, and if the enterprise has been established, then investors will generally conduct on-the-spot visits to the enterprise. The contents of the review mainly include the enterprise management team, the product research and development of the enterprise, and the authenticity of the business plan. On-the-spot investigation of enterprises can make investors truly and comprehensively understand the characteristics, management mode and factory environment of enterprises. And you can also communicate with managers and front-line employees on the spot to understand the enterprise from the side.

If the entrepreneur hasn't started a business yet, investors can't make a field trip, but investors will generally know more about the team to ensure that the team has the necessary characteristics of entrepreneurs and enhance investment confidence.

3. Project appraisal

It is a complicated process for angel investors to evaluate the value of investment projects. PE multiples and discount models cannot be used to evaluate newly created enterprises. So in a sense, the project valuation of angel investors is more like an art.

4. Agreement negotiation

The negotiation of angel investment agreement mainly focuses on investment price, benefit distribution, team incentive, management participation and benefit protection. Angel investors hope that their investment can exit smoothly, recover their investment and realize investment income; Entrepreneurs, on the other hand, hope to get the necessary funds, start enterprise projects and finally succeed.

The interests of both parties are the same, but due to information asymmetry, investors can't fully understand the efforts of entrepreneurs. Therefore, it is necessary to set investment terms to encourage and restrain entrepreneurs.

Angel investors and entrepreneurs will determine the final investment amount and equity ratio according to the estimated funds needed for the investment project and the investor's valuation of the project. Angel investment usually adopts the method of installment investment, and will not invest all the money at once. Therefore, it is necessary to further clarify the investment amount, investment time and conditions of phased investment. Angel investors usually use three investment tools, namely common stock, convertible preferred stock and convertible bonds.

5. Post investment management

Post-investment management depends on the investment style of angel investors. Some angel investors insist on a board seat, while others are dispensable; Some require more participation, while others do not; Some require weekly work reports, while others only require quarterly or annual reports.

In practice, most angel investors will actively participate in the management of invested enterprises. In their view, if entrepreneurs only want their capital, they are not interested in participating. Only those entrepreneurs who need angel investors' funds and their experiences, experiences and suggestions will get real help from angel investors.

Step 6 withdraw funds

The purpose of angel investors' investment is not to run enterprises for a long time, but to make profits by withdrawing from investment. Once the angel investor withdraws from the invested enterprise, the whole process of angel investment is completed. Professional angel investors can put their capital into a new round of capital appreciation activities.

Compared with IPO, it is more realistic, more common and faster to quit by selling shares. The object of selling shares is often large companies in the industry or related strategic investors. If the transferee of equity transfer is an enterprise or entrepreneur himself, it constitutes a share repurchase.