Abstract: On January 14, 2017, taking the news conference on the new book Private Equity LP, the 1st Seminar of Green Legal Global Alliance came to a successful end in Beijing DOCVIT Law Firm and established the first batch of research topics and set up the project closely related to the development of the private equity market. Afterwards, Green Legal Global Alliance has continued to undertake the research work of follow-up legal issues and published supporting books interpreting private equity LP from the perspective of the law field in 2017, making constant contributions to the industrial development.

On the afternoon of January 14, 2017, News Conference of Private Equity LP (a book redefining LP) & "Capital Allocation Strategy, Investment Practice and Operation" Charrette sponsored by CITIC Press Group China Road Research and Publication Center and Green Legal Global Alliance and co-organized by LP Think Tank came to a successful end in Beijing DOCVIT Law Firm, the 56^th floor, Fortune Financial Center (FFC). The book Private Equity LP "redefines LP".

Liu Guangchao, secretary general of Green Legal Global Alliance and director of Beijing DOCVIT Law Firm presided over the meeting. Lu Yuebing, author of Private Equity LP and president of LP Think Tank attended the meeting and delivered a speech.

Lu Yuebing believed that although China's PE and VC development is late, but the momentum is swift and violent. In this process, GP acts as an important driver, while LP is relatively passive on the whole. In the long run, although China has the patience to promote the development of PE and VC, but LP is often scarce. This reminds us that we should consider the following questions, including how to cultivate mature and professional LP in China and make people know the PE asset and its interaction with economy as well as its contribution. In addition, from the financial perspective, what is the nature of PE assets?

Lu Yuebing said, Private Equity LP is the research results consuming three years, the smooth publication of Private Equity LP cannot be separated from the support and guidance of Mr. Wang Zhongmin and Ms. Ji Hong. In the course of publication, CITIC Press Group China Road Research and Publication Center conducted a number of communication with the two authors. At the same time, with the help of LP Think Tank research platform, this book has gained strong support from Professor Floren, who specializes in private equity courses at the London Business School, Robert, chairman of the Emerging Markets Private Equity Association, Drew Kov, Siguler Guff & Company's founding partner, and other experts and scholars at home and abroad. In addition, Lu Yuebing said that this new book release gained support from Green Legal Global Alliance, LP Think Tank has reached a strategic partnership with Green Legal Global Alliance, in 2017, it will further publish and issue supporting books that interpret private equity LP from the legal field and jointly promote the development of private equity market.

This book has four core issues. The first theme is to introduce LP's private placement ecosystem. Including the construction of private equity investment ecosystems (GP, LP, fund, consultant) and processes and success factors of LP private equity investment. In addition, special study aimed at LP and GP's interests docking and ways to get along with each other and risk management of LP investment has been conducted.

The second theme is the allocation strategy. It includes strategic asset allocation of private equity funds (fund type, geographic coverage and industry focus), fund managers' investigation and performance evaluation of funds and secondary market transaction of private equity investment. The hot topics of this part are about China LP's private asset allocation strategy, GP ability attribution and quantitative investment decision-making, responsible investigation and questionnaire design of the fund, the pricing of private placement secondary market transaction and the development opportunities and challenges of China's secondary markets.

The third theme focuses on LPs' investment practices. The book analyzed international and domestic mature and typical LPs. Including mature oversea LP investment experience (pension funds, university endowment funds, Fund of Funds and family offices, etc.) and China's local LP practice results (social security funds, government guiding funds, insurance companies, listed companies, etc.). China has some unique local LPs, for example, government guiding funds are unusual in other countries, and the book carried out a detailed discussion about it. In addition, in foreign Fund of Funds, this book carried out a detailed analysis on Siguler Guff & Company and LGT.

The last theme is about the operation of LPs, including LPs' team construction and operation management, post-investment management and value-added services as well as LPs' future opportunities and strategies in Chinese market. As for the corresponding hot topics, the book studied the use of Fund of Funds as an external intermediary of LPs, the incentive and restraint in LPs' post-investment management and the dilemma and outlet of non-professional LP investment in China.

Globally, private equity has become an important asset allocation category for global institutional investors. From London Business School's study on the asset allocation of private equity, we can find that the allocation of public pension in private equity assets almost doubled, from 4.66% to 8.05%. At the same time, the asset under management (AUM) of the pension fund is over twice the size of the original. But as an important part of the real economy of services, private equity investment is in the ascendant in China. The fund raising of China's equity fund increased 8 times in a decade, and exceeded RMB 1 trillion in 2016.

As the investor behind the private equity fund, LP mainly chooses the track, the rider and the horse. For the track, the construction of investment portfolio needs to be considered. After determining, one needs to determine a person to manage the fund and put money in his hands. Choosing GP is very important, because from the overall return on investment, compared to shareholders' returns and stocks, the return on private equity is decentralized, namely, the bad one is very bad, while the good one is very good.

Overall, China's economy and industries are faced with the challenges of transformation and upgrading, overseas merger and acquisition are key forces to promote the transformation and upgrading. From a macro point of view, in China's future  development process, there are two things to do. First is China's global allocation of financial assets, and the second is the global layout of industrial enterprises. The combination of the two refers to the transformation of China's economy, the upgrading of China's industry, the global allocation of China's capital and the reform and opening up of China's enterprises. If we can do this, we will allocate private equity funds with the world's best GPs in different regions and reach the world's best technologies, brands and channel companies.

Through this layout and the fund manager, we can integrate the best technology and brand assets into China and combine with China's industry and market, and then serve the global layout of Chinese enterprises. In this case, Lu Yuebing believed that the value exploration can achieve a relatively perfect state. He said, "This is a combined style of boxing, we not only do this thing, but search the best global technology and brand by this radar, dock with China's enterprises and industries, so as to achieve the transformation of industrial economy and upgrading of industry. "