In China, when technological innovation becomes a necessary condition for IPOs, do we realize that the road to IPOs is not only difficult but also costly? How can a small business support high costs such as consulting, auditing, and due diligence? After paying these expenses, how much money does the company have to support the business development? Supporting scientific and technological progress? Some people will say that you are alarmist. The actual situation is that the investors who entered in the early stage are generally powerful, and they are the most important operators in arranging the listing of enterprises. If this were the case, there would be no need to write this article today.
The reality we see is that many small and medium-sized enterprises planning to IPO, they are basically "gambling", and they are doing their best to rush to the stock market. During the whole process, the company even did not hesitate to pay wages to employees, and only paid employees living expenses, and almost all the funds were piled up to intermediaries. Because to go public, all documents must be in place, and these documents can only rely on intermediaries such as accounting firms, law firms, and securities institutions. Therefore, of course, the company is lucky to be listed, but once the listing is stranded, for the company, the damage is huge, it will take at least many years to recover, and some are likely to collapse if they cannot withstand the pressure.
Imagine how brutal this process is? And how can we better promote China's innovation and progress? In addition, the development of scientific and technological innovation enterprises must have sufficient capital injection characteristics, coupled with the fact that enterprises have used a lot of capital with a short term or even a gambling agreement with the enterprise when they start-up, what should be done? High rollers go public. So on the one hand, there is a long queue for IPOs in China's stock market, and there is never a tail in sight; On the other hand, the problem of IPOs of science and technology enterprises "breaking through with illness" has become a common phenomenon; On the other hand, all kinds of venture capital investors use the listing of their portfolio companies as a sign of success.
Is there really only one way to IPO success since ancient times? In 1999, when I was producing the large-scale feature film "Capital Market" on CCTV, I spent a long time studying Silicon Valley in the United States. An important finding in the study is that small and micro innovative enterprises in Silicon Valley have long been targeted by large enterprises, and innovation capital relies on less than 5% of IPO exits, and more than 95% of successful exits are completed by large enterprise acquisitions, and small and micro enterprises have also obtained the support of large capital.
At that time, we proposed that China's capital market lacked an important path - the enterprise acquisition market, and the active acquisition market may be an important support for China's scientific and technological innovation.
Unfortunately, the road to corporate acquisition has not been smooth for many years. Why? According to my analysis, there are at least three points: first, there is a cultural awareness of "rather being a chicken head than a phoenix tail", which strengthens the "gambling nature of many enterprises" to be a chicken head; Second, China's large enterprises, especially large state-owned enterprises, are either inert or arrogant, blind to the innovation ability of small and micro enterprises, look down on the innovation achievements of small and micro enterprises, they even want to do everything themselves, and they do not have to bear any responsibility if they fail, which may be one of the important reasons for the insufficient technical reserves of large Chinese enterprises; Third, China's capital market and its related policies lack incentives for innovative acquisitions, especially the acquisition bids of small and micro technology companies are not attractive enough.
What to do? The issue of cultural awareness needs to be guided, but more importantly: large companies need to have the impulse to acquire technology and reject discriminatory bids.
Recently, the State-owned Assets Supervision and Administration Commission (SASAC) held a special meeting on improving the quality of listed companies and M&A and restructuring of central enterprises to study the issue of "central enterprises should use listed companies as a platform to carry out mergers and acquisitions and reorganization to improve their core competitiveness". The purpose of the conference is to "continue to promote central enterprises to improve the quality of listed companies, focus on mergers and acquisitions of listed companies, exchange work experience, and clarify work ideas". At the meeting, responsible comrades of relevant departments of the China Securities Regulatory Commission introduced the relevant situation of mergers and acquisitions and reorganization of listed companies controlled by central enterprises in recent years, and put forward expectations and suggestions for listed companies controlled by central enterprises to further improve quality and efficiency, improve and strengthen through mergers and acquisitions from the perspective of capital market supervision.
This is a positive change. In the past, when the mergers and acquisitions of central SOEs and SOEs were mentioned, it was immediately understood that central SOEs and SOEs were carrying out mergers and acquisitions between each other in order to become bigger and stronger, and some changes have taken place in recent years, and the scope of acquisition is gradually expanding. It is hoped that in the future, state-owned enterprises and central enterprises can pay more attention to those innovative small and micro enterprises, and acquire them to strengthen the integration capabilities of their industrial chain, supply chain and value chain, and also provide a "trouble-saving" exit road for scientific and technological innovation enterprises. From the perspective of national tactics, such behavior of state-owned enterprises and central enterprises also provides a way for the high-quality innovation and development of China's economy to save social capital far more than IPOs.