The Impact Of Venture Capital Syndication On IPO Underpricing Of Entrepreneurial Enterprises

Venture capital is a kind of equity capital with high-tech,high-growth and high-risk enterprises as investment targets.In recent years,along with the development of China’s multi-level capital market,China’s venture capital industry is also in a rapid development stage.As a special form of venture capital,venture capital syndication is increasingly favored and chosen by venture capital institutions because of its advantages such as being able to diversify risks and share resources.This situation has prompted scholars to conduct a series of studies around venture capital syndication.In a venture capital syndication,the members involved in a venture capital syndication are diverse,and they may come from different backgrounds and differ in terms of knowledge and technology and corporate culture.As a result,venture capital syndication can exhibit varying degrees of diversity,and this diversity can manifest itself in multiple dimensions.Entrepreneurial enterprises supported by venture capital syndication are also affected by this diversity,and their performance in the IPO market will vary depending on the degree of diversity of venture capital syndication in these dimensions.In this paper,we theoretically explore the effects of venture capital syndication type diversity and venture capital syndication geographic diversity on IPO underpricing of entrepreneurial enterprises,and introduce the moderating variables of geographic distance and institutional environment to systematically explore the mechanism of the role of venture capital syndication diversity on IPO underpricing of entrepreneurial enterprises.This paper explores how the diversity of venture capital syndication affects IPO underpricing of entrepreneurial enterprises by collecting and compiling data related to listed firms in GEM during2009-2016.This paper conducts regression analysis on the relevant data and finally draws the following conclusions:First,the higher the degree of diversity of venture capital syndication type diversity,the lower the IPO underpricing of entrepreneurial enterprises.Second,the greater the geographic distance,the weaker the direct effect of venture capital syndication type diversity on IPO underpricing of entrepreneurial enterprises.Third,the higher the degree of geographic diversity of venture capital syndication,the lower the IPO underpricing of entrepreneurial enterprises.Fourth,the better the institutional environment,the weaker the direct effect of venture capital syndication geographic diversity on IPO underpricing of entrepreneurial enterprises.This paper enriches the research related to the impact of venture capital syndication on entrepreneurial enterprises and provides a theoretical basis for understanding the diversity of venture capital syndication.