Core Viewpoint - The venture capital (VC) and private equity (PE) industry is facing significant pressure regarding buyback clauses, despite recent government policies aimed at increasing tolerance for losses. The overall sentiment in the market remains cautious, with no substantial easing of buyback terms observed [1][2][4]. Group 1: Government Policies and Market Response - Local government guiding funds have introduced policies to increase loss tolerance, with some regions allowing up to 100% loss on individual projects, but these policies have not yet translated into a broader easing of buyback terms in the market [4][6]. - Specific examples include Sichuan province's measures allowing a maximum loss tolerance of 60% for government funds, and even higher for seed-stage investments [4][6]. - Despite these supportive policies, industry insiders report that new limited partners (LPs) have not increased their tolerance for losses, indicating a disconnect between policy intentions and market realities [4][6]. Group 2: Changes in Buyback Clauses - Some VC firms have made slight adjustments to their buyback clauses, such as implementing a "two-year assessment" mechanism, but these changes are not widespread and are accompanied by stricter quality requirements for projects [2][3]. - Innovative cases have emerged, such as allowing founders to swap equity to avoid buybacks, which has received approval from government LPs, indicating a potential shift in approach [2][3]. - Overall, the relaxation of buyback terms remains an exception rather than the rule, with many firms still adhering to traditional cautious practices [2][3]. Group 3: Increased Scrutiny and Pressure on Funds - The scrutiny from government and state-owned LPs has intensified, with requirements for regular reporting and audits becoming more stringent, leading to a tightening of assessments for funds [6][7]. - The complex regulatory environment, including oversight from multiple departments, has made decision-making more cautious and slow, hindering the responsiveness to potential policy relaxations [6][7]. - The combination of increased pressure from LPs and the challenges of exiting investments has led to a rise in fund extensions, with many funds unable to exit as planned [6][7]. Group 4: Future Outlook - The adjustment of buyback clauses is currently a negotiation between policy direction and market conditions, with expectations that as policies are implemented and market mechanisms improve, buyback terms may evolve towards a more accommodating stance [7]. - The industry faces the ongoing challenge of balancing risk control with innovation and inclusivity, which will be a central theme in the near future [7].

Core Viewpoint - The article discusses the ongoing challenges faced by venture capital (VC) funds regarding buyback clauses, despite recent government policies aimed at increasing tolerance for losses. The anticipated positive impact of these policies has not yet been felt at the market level, with many VC firms maintaining a cautious approach to buyback terms [2][4][6]. Group 1: Buyback Clauses and Market Response - The buyback controversy has become a focal point in the primary market, driven by the pressure on VC funds to deliver satisfactory returns to their limited partners (LPs) [2][5]. - Although local governments have introduced policies to increase the tolerance for losses, there has been no significant relaxation of buyback terms across the industry. Most VC firms remain cautious when addressing buyback issues [2][4][6]. - Some VC institutions have made slight adjustments to their buyback clauses, such as implementing a "two-year assessment" mechanism, but these changes are not widespread and are often contingent on the quality of the projects [4][10]. Group 2: Government Policies and Industry Impact - Since 2025, local government guiding funds have rolled out policies that allow for a maximum loss tolerance of up to 60%, with some funds targeting seed-stage or future industries allowing up to 80% [7][8]. - Despite these supportive policies, feedback from industry insiders indicates that the anticipated benefits have not yet reached the VC fund level, with many LPs not increasing their tolerance for losses [8][11]. - The regulatory environment has become more stringent, with LPs requiring detailed reporting and audits, which complicates the decision-making process for VC funds [11][12]. Group 3: Trends in Fund Management - The combination of increased pressure from LPs and the challenges of exiting investments has led to a rise in fund extensions, with many funds unable to exit as planned [12]. - The article highlights that the adjustment of buyback terms is currently a negotiation between policy direction and market realities, suggesting a gradual evolution towards more accommodating terms in the future [12].