Cao, Humphrey-Jenner & Suchard: Government ownership and venture performance – Evidence from China

ABSTRACT:

We study the government’s role in VC market in China. The impact of government depends on whether the fund is wholly or partially government-owned at central or provincial level. Partially government-owned VCs improve venture success, e.g., the likelihood of exit via an IPO and the likelihood of exit in mainland China. Investment from provincial government-owned VCs is associated greater exit-success, with such advantage diminishing with more funds. Government-owned funds exhibit worse performance at the fund-level. Our findings suggest that government VCs may benefit through political connections may help VCs, but that excessive government control leads to inefficiencies.

 

Available for download here.

Allahar: The Search for a Venture Capital Model Appropriate to Small Emerging Countries

ABSTRACT:

The purpose of this paper is threefold covering a review of enterprise financing mechanisms, examination of the concept of Venture Capital (VC) and its operations in developed and emerging countries, and proposing a community-based VC model as appropriate to small emerging markets. The research methodology involves primarily, reviews of published data on the VC industry and analysis of raw statistical data on the performance of VC in major developed and emerging countries, US, Europe, China, and India. The main finding of the paper is that VC, as a business financing tool, has a significant role to play in expanding the menu of financing options and facilitating business development in emerging countries and small and medium sized businesses. The overall conclusion is that the models of VC financing available are more suited to developed country markets and there is no model appropriate to smaller markets for which a community-based VC model is fit for the purpose.

 

Available for download here.