How should companies develop financing strategies?

[China Glass Network] With the rapid development of the capital market, enterprises can use more and more financial resources. Some enterprises familiar with the rules of the game in the capital market are often good at using the power of capital to quickly gain the competitive advantage. We have witnessed countless facts: In some industries, a small, unseen company that suddenly became a leader suddenly became an industry leader. The company that is stronger than it is far behind, making all the peers sigh! In this way, let those traditional business owners come to the surprise. The GEM, which was launched on October 30, 2010, set an example for us. Twenty-eight companies in 28 companies have grown up through equity financing in the development process, which has played a huge role in helping the board to become a GEM. The GEM has a total of 15.4 billion yuan, creating 74 billionaires. So far (as of July 28, 2012), there are already 341 companies listed on the China GEM. We have studied the ownership structure of all GEM listed companies, and more than 80% of them have introduced equity before the IPO. Investors (including financial investors, strategic investors or industrial investors). Similarly, Chinese companies listed overseas have set an example for us. Nearly 250 Chinese companies listed overseas have 100% support from private equity funds. After these companies went public, they also invested huge amounts of money in supporting the development of the company in the secondary capital market.

Later business owners should figure out a question: What is the power that drives such a company to come up later?

-- The era of financial dominance has arrived. In China, the era of deep capital operation has arrived. The competition among enterprises is no longer just a technical level, a competition at the talent level, and a higher level of competition - capital competition. The competition between enterprises does not depend on the speed of technology research and development and the scale of market expansion, but ultimately depends on the speed and scale of corporate financing. Today, the market environment and financing environment of enterprises are undergoing profound and tremendous changes: multi-level capital markets have taken initial shape, venture capital and venture capital are surging, corporate financing channels are greatly expanded, and a new financing platform – equity financing It is playing an increasingly important role. The helpers outside the normal financing channels are all usury, because of the squeeze of usury, many companies overturned in the gutter. Over the past decade, mainland China has wiped out a billionaires on average for 50 days, 80% of which are related to usury. This reflects the importance of financing strategy and financial leadership from the opposite side.

- Enterprises must update their ideas. If an enterprise wants to develop, grow, and keep up with the pace of the times, it will remain invincible. Entrepreneurs must first break the traditional way of thinking. Most companies are still in a traditional state of operation: through their own surplus to expand reproduction, from small to large, slowly snowball development. This type of development has already brought a huge threat to growing companies. In the case of fierce competition, companies must develop rapidly, and when they are slow, they will be eaten by competitors. Therefore, it is necessary to raise funds for development. The main channel for financing is borrowing, which is debt financing. The traditional borrowing methods are harsh, which makes the company carry a heavy burden: the principal and interest are increasing year by year, the collateral and guarantee resources have been exhausted, and the pressure on the enterprise is huge. In the context of rapid development of the capital market, if entrepreneurs are still stuck in the old way of thinking and behavior, they cannot see the future, grasp the general trend, and seize the opportunities, they will certainly miss the opportunity and hate life.

-- Choosing a financing strategy determines the future of the company. The traditional business model is shotguns and guns. The way to promote the development of enterprises through the capital market is the nuclear explosion of nuclear weapons. The power of this kind of "nuclear explosion" is enormous and rapid, and will form a large-scale reorganization, merger, joint venture, and acquisition wave in the industrial chain of all walks of life. Through the power of capital, the global advantageous resources will be brought together to achieve The allocation of the entire social resources is more optimized and larger. The 30 years before the reform and opening up mainly relied on “opportunity plus products”; the essential feature of the 30 years after the reform and opening up was “capital plus technology”.

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