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Chairman, Founder and Chief Executive Officer at China First Capital ( , a China-based international investment bank and advisory firm for capital markets and M&A transactions. China First Capital was established in 2007 and has its headquarters in Shenzhen, China.... More
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  • China's Central Government Gets Serious About Changing IPO Rules And Helping SMEs Raise Capital, Global Times Article

    Govt calls for progress in IPO reform to help small firms

    Amid a slowing economy, the Chinese government is considering strategies to help the country's cash-starved micro and small companies. Upcoming IPO reform is expected to offer easier access to stock market funding, but investors are concerned it could divert funds from existing stocks.

    A view of the Lujiazui Financial District in Shanghai Photo: IC

    While China's economy has been affected by a weakening property sector, erratic foreign demand and sagging domestic investment growth, the authorities are hoping that the country's millions of micro and small enterprises (MSEs) can offer a source of economic energy.

    The State Council, the country's cabinet, pledged on Wednesday to lower the cost of raising funds by giving banks more flexibility to lend and removing rigid profit requirements for a firm to get listed in stock markets, among other measures aimed at making it easier for small firms to grow.

    At the meeting on Wednesday, Premier Li Keqiang urged the securities regulator to speed up plans to unveil simplified rules for new IPOs.

    Two days after the cabinet's meeting, the central bank cut interest rates for the first time in two years.

    While the rate cut will be of particular benefit for large State-owned enterprises, simplified IPO access is expected to make it easier for cash-starved smaller firms to raise money directly in the markets.

    Under the existing IPO scheme, applicants must meet certain conditions in order to get listed in Shanghai or Shenzhen, including having made a profit for at least two consecutive years and having net profit of at least 10 million yuan ($1.63 million).

    Even if they meet these requirements, IPO applicants are also subject to the review and approval procedures of the China Securities Regulatory Commission (CSRC), the securities watchdog.

    The CSRC suspended its IPO reviews in late 2012 in a bid to enhance information disclosure and crack down on rampant financial fraud and insider trading.

    The CSRC also wanted to lay solid foundations for a new round of IPO reform intended to diminish government intervention and establish a more efficient, market-based IPO filing system.

    The regulator restarted IPO approvals in December 2013 after a 13-month hiatus.

    However, the suspension had resulted in a long queue of IPO applicants. As of mid-November this year, 570 firms were waiting for their applications to be reviewed, according to media reports.

    A plan for an IPO filing system with a focus on information disclosure is likely to be released by the end of 2014, the 21st Century Business Herald reported on Thursday, citing a source close to the CSRC.

    Equal access

    Under the new IPO registration system, the CSRC will no longer intervene in the listing process and will focus on supervision rather than review and approval, analysts said.

    The system will provide access to market financing for all firms, not just those at the front of the queue for IPO approval, and the investment value shall be judged by investors, not the government, Dong Dengxin, director of the Finance and Securities Institute at Wuhan University of Science and Technology, wrote on his Weibo on Saturday.

    The CSRC was not available for comment on the schedule of IPO registration reform when reached by the Global Times on Thursday.

    As China tries to move up the value chain and restructure its economy, small firms have become increasingly important. They also account for more than 70 percent of the country's jobs.

    "While the IPO reforms are absolutely correct in their direction and implementation, the capital markets in China are still unable to provide the financing needed for most MSEs to continue to grow," Peter Fuhrman, chairman and CEO of Shenzhen-based investment bank China First Capital, told the Global Times in an e-mail on Saturday.

    Relatively slow approval of IPOs and the exceptionally long waiting list are seen as the major reasons for the difficult funding.

    There are "thousands of Chinese MSEs with good size and profits" that are waiting to go public, said Fuhrman.

    This year has been a difficult year for MSEs in China. With the overall economy slowing down, profits and growth have been lower than at any time in recent history.

    At the same time, domestic banks have tightened up on lending, and MSEs are now largely relying on high-cost loans from trusts and other shadow banking organizations.

    The new IPO filing system will offer a fresh lifeline for MSEs, Wang Jin, general manager of TLD Registry, a domain name registration service provider, told the Global Times on Thursday.

    Though his company, headquartered in Ireland, is poised to get listed in the European stock market in the future, a listing in China would also be a good option as the company's business is mainly in China, he said.

    Due to the current rigid rules and long waiting list, many high growth Chinese tech firms including Alibaba Group Holding and Inc have chosen to list in the US instead.

    In January, China launched the New Third Board, an over-the-counter (OTC) market similar to America's Bulletin Board and Pink Sheets, which offers a national share transfer system for MSEs. There had been years of trials for the new board in several cities as part of China's efforts to build a more diversified market.

    The OTC market also serves as a springboard onto the Growth Enterprise Board, China's NASDAQ, with companies able to move onto the main exchanges later.

    However, a lack of active trading and uncertainty over the process of transferring onto the main exchanges have held back the fledgling OTC market so far.

    Investors still concerned

    One major concern for investors is that simplifying IPO access will result in a greater supply of stocks, which will lead to funds being diverted away from existing stocks.

    However, the IPO registration system will be beneficial as long as it involves tough penalties and strong oversight against financial fraud and insider trading in order to protect investors' interests, Wang Zhan, a Shanghai-based retail investor, told the Global Times on Thursday.

    With an increasing supply of stocks under the new IPO system, fresh capital, particularly international capital, needs to be introduced into the Chinese stock market to ensure active trading, he said.

    Wang likened China's stock market to a water pool - if more fish are put in it, more water will be needed, Wang noted.

    The Shanghai and Hong Kong Stock Connect program went live on November 17, giving Hong Kong and mainland individual investors access to each others' stock markets. It also gives far greater access for international capital to China's A-share market.

    Nov 24 10:39 PM | Link | Comment!
  • NFL And American Football Are Booming In China, My Chinese-Language Column For Forbes China, "美式橄榄球:美国最受欢迎的运动能否赢得中国市场?"

    Peter Fuhrman

    Peter Fuhrman 中国首创投资的创始人和董事长




    提起跟美国有关的运动,中国人脑子里第一个跳出来的可能会是篮球--NBA在中国受到 了空前的瞩目,这当然也有姚明的重要贡献。不过,最近几年,另一项美国运动也在中国取得了不错的发展,吸引了越来越多的观众。不像篮球,玩这个运动的人目 前在中国还不多,但是以中国大城市中"金领"工作者为主的球迷群体正在迅速地增长。这项运动就是美式橄榄球。

    美式橄榄球的历史源自于英国在19世纪中期公立学校流行的各种早期"足球类"运动,是由英式橄榄球直接演变过来的。自1960年代,美式橄榄球就已经超越 篮球和棒球成为美国最受喜爱的运动项目。美式橄榄球在美国受欢迎的程度超乎想象,它的比赛已经不仅仅是一种体育项目,更是美国文化很重要的一部分,如果你 了解它,会发现它并非只是暴力的对抗与碰撞,还融合了速度、力量、战术、团队配合等,也是一项充满智慧的运动。

    美国国家橄榄球联盟(National Football League,简称NFL,中文译为"美球") 是世界最大的职业美式橄榄球联盟,已经有94年历史了,也是世界最具商业价值的体育联盟。联盟共有32支球队,因为他们都是私人投资、按照公司模式运作, 所以也被称为特权会员队 (Franchise)。

    成立之初的NFL很难称为一个大型体育联盟,直到1970和1980年代,在NFL的不懈推广下,橄榄球强化了其做为美国顶尖运动的地位和在美国文化里的 重要角色。1967年,NFL举行了第一场年度冠军赛 "超级碗 (Superbowl)",之后每年超级碗固定在一月或二月初的星期天举行,比赛那一天也被称为"超级碗星期天(Super Bowl Sunday)"。

    超级碗多年来都是美国收视率最高的电视节目,并逐渐成为一个非官方的全国性节日,被中国媒体戏称为"美国春晚"。每年,超级碗在美国国内有一亿多的电视观 众,其广告也是美国电视上最贵的,30秒的广告费用达到400万美元(相比之下,奥斯卡的广告费用是每30秒180万美元,还不到超级碗的一半)。

    现在的NFL已经是美国最著名的职业体育联盟,其他联盟也试图和NFL竞争,但都没能像NFL那样获得这么大的支持,拥有这么多的球迷。NFL的球迷人数 超过其他三大联盟(棒球联赛,NBA,冰球联赛)球迷人数之和,达到1.88亿人,其中有高达半数认为自己是"狂热球迷(Avid fans)",并且球迷横跨各个年龄层。在美国,NFL赛事也是收视率最高的比赛。NFL的季前赛收视观众数就已经超过了NBA总决赛的收视观众 数;2013年NFL常规赛的平均收视人数是1,760万,而NBA仅120万。

    这样无与伦比的受欢迎度也使NFL成为世界上最成功、盈利最高的体育联盟, 2013年收达到120亿美元。NFL的32只球队的平均市值达到14.3亿美元(约87亿人民币),其中市值最高的Dallas Cowboys (达拉斯牛仔队)价值32亿美元(196亿人民币)--成为世界上市值第二高的球队,仅次于市值34亿美元的皇家马德里足球俱乐部。




    但是,随着20多年来NFL在英国不遗余力地推广美式橄榄球,培养更多的英国人去热爱这项运动,如今美 式橄榄球已经在英国最受欢迎的运动里排名第五。从2007年开始,NFL每年在伦敦举行固定赛事,这也成为了NFL International (NFL国际系列) 目前最主要的赛事。今年,NFL在温布利体育场一共举行三场比赛,所有的门票(共24万张)在开售后两天内即售罄。


    从2010年到2013年,短短四年不到的时间,美式橄榄球在中国的球迷数量从160万增长到1,400 多万,并预计在未来8年长期保持至少年平均22%的增速,2021年在中国拥有超过4,000万美式橄榄球球迷。2013年NFL在中国20多家电视频道 上 播放的比赛收视人数达7,000万,预计在未来8年年平均增长10%(而NBA去年在中国的电视收视人数已经几乎没有增长)。互联网收视人数在也过去四年 取得了1,371%的增长,预期会在2021年超过电视收视人数。


    我从小在纽约生活,也是个橄榄球迷。如今,我能在中国与NFL合作,推广美式橄榄球这 项运动,我觉得这项任务很有趣也很荣幸能够参与其中。NFL已经有94年历史了,其在上世纪20年代成立之初,橄榄球在美国还是个比较非主流的运动。

    90 多年间NFL成长为如此成功的运动联盟,使美式橄榄球称为在美国最受欢迎的运动,很好地展现了一个公司应该如何进行长期的成长规划,制定战略并且耐心地执行,进而取得长久的成功。因此我相信在中国他们也将达成目标。

    Nov 07 6:42 AM | Link | Comment!
  • China's 800-Year-Old iPhone

    (click to enlarge)


    While China's recent performance may be a disappointment, averaged across the millennia no other nation has provided the world with such an abundant wellspring of innovation. Have a look at this long list of Chinese inventions. Not a day passes for most of us when we don't rely on at least one product of Chinese ingenuity, be it paper money, the bristle toothbrush, toilet paper, oil wells. A slightly smaller group of us wouldn't want to long tolerate life without noodles, steamed or stir-fried food, tofu, tea, alcoholic drinks.

    Left off the Wikipedia list is one other Chinese gadget that played a central role in people's lives, especially in East Asia, for centuries and then abruptly disappeared over the last two decades. It's also my personal favorite among all Chinese inventions, the abacus. I grieve over its extinction.

    When I first got to China in 1981, the abacus was ubiquitous - in every shop, bank, schoolroom and government office. If it had to be counted or calculated, an abacus was required. I still remember the loud and ceaseless clicking sound inside the main room of Nanjing's cavernous People's Bank as dozens of clerks tabulated and re-tabulated sums, louder and more rhythmic than the clatter of cicadas outside. Cheap electric calculators and PCs not only killed off the abacus they also have turned China's banks and offices into quieter more monotonous spaces.

    Among all Chinese inventions, nothing quite rivals an abacus, or "算盘 suanpan" in Chinese, for pure "out of the box" ingenuity. There's no clear predecessor machine, and no real evolution or improvement from the device that is first described almost eight hundred years ago in Chinese books and begins appearing in Chinese paintings five hundred years ago.

    Though the name of the inventor (or inventors) is lost to history, none but a towering genius could invent a portable lightweight tool and the accompanying fingering technique to allow a few rows of beads separated on two stacked decks, five beads on the lower and two on the upper, to perform high-speed, accurate multiplication, division, addition, subtraction, square root and cube root operations. In geek-speak, hardware and software are proprietary and seamlessly integrated. The abacus, unlike the modern electronic calculator, is as easily used for calculations in base ten (decimal), base 16 (hexidecimal) or any other base you might choose.

    Europe and America, so dominant in most spheres of invention these last 400 years, contributed in the 17th century the slide rule and adding machine to the technology of calculation. But, neither achieved the widespread use in teaching and daily life the abacus enjoyed for centuries. Most Chinese aged over 30 (as well as tens of millions in other parts of Asia) were taught in school to use an abacus. While most have since sadly forgotten how to use one, they once could manipulate the wooden beads as quickly and accurately as skilled touch typists.

    I recently went off to see if I could buy an old wooden abacus. It's harder than you'd think. My guess is there were at least 400 million abacuses in China thirty years ago. Today, they've completely disappeared from sight. I can't recall a single time I've seen one in use during the last five years living full-time in China. Something of great functional beauty and utility has gone out of Chinese lives.

    I did eventually succeed in finding one at an antique market in Shenzhen. It looked to me, based on the filigree bronze hinges, to be about 120 years old. The seller, in his early 60s, had forgotten how to use it, as did everyone else who gathered around to watch me bargain for it, with the exception of one handsome older woman trained in the early 1970s as an accountant. I asked the seller to give us some random four-digit numbers to add and subtract, with me using the calculator on my phone and her using the old abacus. In each case, she was quicker than me. I had to repeat each number in my head before tapping on the keyboard. Her fingers, on the other hand, were in motion from the first sound. It was a virtuoso performance.

    An abacus is not a calculator, in the sense that you punch in numbers and it spits out an answer. "The person operating the abacus performs calculations in their head and uses the abacus as a physical aid to keep track of the sums, the carrys," explain the experts at Canada's Ryerson University.

    After polishing away the dust, I put the abacus on the table in the CFC's meeting room. I'm determined to learn better how to use it, but conscious of ebbing mental and physical dexterity.

    It looks like nothing else on the planet, and yet it shares similarities with an iconic device invented from 800 years later (in 2007) in Silicon Valley. A swipe-operated high-tech tool, with a simple rectangular design, its engineering elegant yet practical, and an intuitive interface that allows anyone with a little practice, from kids to old folks, to solve routinely and quickly a host of problems once thought too challenging for ordinary folk. The iPhone is the abacus of our age.

    Oct 30 7:53 PM | Link | Comment!
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