Research On Venture Capital Portfolio Optimization From The Perspective Of Network

Our research in this paper considered multible properties of venture capital investments(including the setup cost,the investment preferences,the number of invested start-ups and the total investment)and entrepreneurial projects(the expected returns and risks,the transaction costs and capital requirements),from the perspective of social network,applicated theories and methods of portfolio theory and research planning model.We discussed the venture capital portfolio optimization problems from whether to consider the joint investment situations,and got some results as bellow:Firstly,without considering the joint investment(i.e.,the single investment network),we got some important results and discoveries:a)In the case of the same investment preferences,start-ups with high returns and high risks are more likely to be invested.b)Under the same conditions,diversificated investment is better than centralized investment.c)Increasing the gap of investment preferences of venture capital institutions is beneficial to increase the total returns of investment network.d)Within a certain range,there is an inverted U relation between the return of investment network and the number of venture projects.The number of venture projects has an optimal range,which means too many will lead to lower returns or even losses.Secondly,considering the joint investment(i.e.joint investment network),we also got some interesting results and discoveries:a)The higher the risks and uncertainties of venture capital institutions,the greater the possibilities of joint investment.b)The bigger the gap among venture capital institutions,the more difficult will they choose joint investment.c)When the number of start-ups gets bigger,the possibility of joint investment has not changed significantly,the proportion of joint investment in the investment network is about 40%-50%.d)in the same conditions,compared to single-investment,joint-investment can get more returns.This research based on the background of venture capital,using the allocation of resources in the network,analysed how to reasonably layout of venture capital institutions,how to use the suitable investment portfolio strategies and how to choose investment projects and whether to choose joint investment.Provided constructive opinions to the venture capital institutions and the government.And also have some theoretical and practical significance on the development of venture investment portfolio network.