An Empirical Study On The Impact Of Heterogeneity Of Joint Venture Capital Members On Corporate IPO Performance

Venture capital plays an important role in improving the overall level of science and technology in a country.Therefore,China has also encouraged the development of venture capital.In the past ten years,venture capital has been highly developed in China,and more and more startups will be invested by VC,Venture syndication has become the main investment method of VC.The VC heterogeneity of the members of venture syndication will have an impact on the value-added services of the invested company,which in turn will affect the company’s IPO performance.Therefore,it is very important to study the conditions under which the heterogeneity of members of joint venture capital is beneficial to corporate IPO performance.Scholars have two definitions of venture syndication,one of which is that two or more VCs invest in the same company in the same round of investment.This definition is also called a narrow definition.There is also a broad definition,this view believes that the investment time of multiple VCs should not be limited.As long as a company is invested by two or more VCs,whether it is the same round or not,it can be regarded as a venture syndication.This article believes that the impact of VC on enterprises runs through the period from the beginning to the IPO,and should not only focus on a certain round of investment,so this article uses a broad definition.The heterogeneity of the various members of the venture syndication will affect the IPO performance of the invested company.The heterogeneity of the members in the venture syndication refers to the heterogeneity caused by the differences in the characteristics of the venture capital institutions that make up the joint investment and the differences in the services to the invested enterprises,the IPO performance of the invested company is judged according to the underpricing rate on the day of the IPO.A low IPO underpricing rate indicates good IPO performance,and vice versa indicates poor IPO performance.This paper studies the impact of heterogeneity in the three aspects of the VC shareholding ratio,age and capital background of venture syndication on corporate IPO performance,the heterogeneity of the shareholding ratio refers to the heterogeneity caused by the different proportions of the shares held by the VC held by the VC members in the venture syndication,the age heterogeneity refers to the heterogeneity caused by the difference in the length of time that each member of VC in the venture syndication is established,the capital background heterogeneity refers to the heterogeneity caused by the different VC capital sources of each member of the venture syndication.The sample data used in this article is selected from the domestic Shanghai and Shenzhen main boards,GEM and SME boards.These samples are all companies that have been invested by VC and successfully IPO in the 11 years from 2008 to 2018.After screening,the number of valid samples was 607.According to the needs of research,the data required in this article mainly include venture capital related data,corporate IPO performance index data and relevant financial data of IPO companies.When the data is tested,the interference of heteroscedasticity and colinearity on the test results is first excluded.Finally,regression analysis was performed on the model,and the following research conclusions were drawn:(1)The IPO performance of a company is negatively related to the heterogeneity of the shareholding ratio of the venture syndication members,which indicates that in a venture syndication,the greater the difference between the shares of the invested company held by each VC,the worse the IPO performance of the invested company;(2)The IPO performance of the company is positively related to the age heterogeneity of the venture syndication members,which indicates that in a venture syndication,the larger the time between the establishment of each VC,the better the IPO performance of the invested company;(3)The IPO performance of the company is positively related to the heterogeneity of the capital background of the venture syndication members,which indicates that in a venture syndication,the capital background of each VC is diversified,and the invested company’s IPO performance will be better.In theory,the research results of this article not only enrich the relevant theoretical results in the field of venture capital,but also enrich the relevant theoretical results in the field of influencing factors of corporate IPO performance.In the real world venture capital business,the findings of this article can help startups look for different VCs for financing.