The Impact Of Venture Capital On The Performance Changes Before And After IPO Lockup

As a special financing method,venture capital has always been favored by high-tech and small and medium-sized entrepreneurial enterprises.Different from debt financing,which requires regular repayment of principal and interest,venture capital is invested in the form of equity.Venture capital investment can not only solve the capital needs of enterprises,but also provide additional value-added services for enterprises.Many enterprises will seek venture capital in the process of development,so as to get their performance on the right track faster.But for managers of venture capital institutions,who need to recover and add value,they have an incentive to push their companies to complete IPO as soon as possible so that they can exit profitably in time.However,with the arrival of the IPO period and the successful exit of venture capital,will the performance of listed companies still maintain stable growth? Or will there be a decline in performance? If performance changes,what are the causes? Is the impact of venture capital on performance change different in different external institutional environments?To explore the mechanism of the influence of venture capital on the performance changes before and after the suspension of IPO is the problem which this paper intends to solve.This paper firstly analyzes the possible impact of venture capital on the performance changes of the invested enterprises before and after the lifting of the IPO ban from a theoretical perspective,and further discusses whether there are differences in the impact in different external institutional environments.570 listed companies publicly listed on China’s gem market From 2009 to 2016 were used as research samples for empirical test.The results show that venture capital has a positive effect on the performance changes of invested enterprises after the IPO ban is lifted.Compared with foreign-backed venture capital investment,the performance of enterprises with local venture capital participation is less likely to decline after the IPO ban is lifted.Companies with a high reputation are less likely to see their performance decline after the IPO ban is lifted than those with a low reputation.Further research found that a good external institutional environment will strengthen the positive impact of venture capital on the performance change after the IPO was lifted,and the improvement effect of local venture capital and low-reputation venture capital on the performance decline after the IPO was lifted will be more obvious.