Venture Investment On The Development Of High-tech Enterprises

As one of the most important fundraising way for high-tech enterprises in the start-up period, venture capital provides an important guarantee of funds to make high and new technology translate from research achievements into commercial products or services. And during the maturation process of high-tech enterprises, venture capital participates in the development process of the high-tech enterprises with its management concept and style to take part in management, risk controlling and performance improving for them. GEM(Growth Enterprises Market),as one of the venture capital’s withdrawal channels, not only collects more funds for high-tech enterprises, but also makes venture capital gain profit from it and turns the profit into a new round of investment to form a circulation system.This article firstly describes the concepts of high and new technology enterprise, venture capital and GEM, analyses the meaning and characteristics of them and retrospects the Chinese and western scholars’research achievements in this field by literature review. Secondly, this article is based on the venture capital’s perspective to do in-depth analysis of its impact on the development of high and new technology enterprise. This part introduces the operation process of venture capital and the mechanism of action of various processes for high and new technology enterprise, and then discusses the theoretical model of the role of venture capital to high and new technology enterprise IPO. It summarizes the positive influence that venture capital has made on high and new technology enterprise IPO by the theory that venture capital certification and supervision in IPO, and the negative influence is epitomized by adverse selection theory. Through literature review, this paper summarizes and reviews the western scholars’ empirical analysis results of these two kinds of effects, and uses them as the theoretical basis of this article. This part also presents the description and analysis of the venture capital combined with the reality of our country. Use authority and the authors’data to analyze the venture capital and GEM’s status quo, future and interactive relationship of our country. The third chapter is the empirical part and the focus of this article. Selecting281companies listed on GEM by the end of December2011as the samples, according to the prospectus to confirm whether the companies have venture capital background, the article screens out156companies with venture capital background and125companies without it, compares their financial performance before and after IPO and carries on linear regression analysis of the GEM listed companies’under-pricing rate and the influencing factor of long-term share price. The main conclusion is that the difference is not statistically significant for the companies with or without venture capital background in the scale of income growth, net profit growth rate, income. But the venture-backed companies’mean value of these indicators is higher than the companies without venture capital background that means venture capital has played a certain positive role before IPO, the venture capital’s supervision and management promote the development of the companies to a certain extent. This paper uses the method of regression analysis to verify the performance of the company with or without venture capital background in the process of IPO and find out that venture-backed companies’under-pricing rate is higher, and the long-term share performance is worse, that validates the adverse selection theory. It also has other conclusions by studying turnover rate, income scale of listed companies, offering size and so on, such as the companies with strict audit and supervision before IPO spend lower issue fee and get lower under-pricing rate and higher long-term share price performance. Finally, according to the conclusion and the status quo of Chinese venture capital market, the article gives suggestion from the aspects of government, market, talent and law to provide the reference for the development of the venture capital and GEM of our country.