The role of venture capital in IPOs: Evidence from Shenzhen Stock Market

Author

Yucan, Liu ; Xiaomin, Gu ; Jieting, Chen

Author_Institution

Sch. of Econ. & Manage., Nanjing Univ. of Sci. & Technol., Nanjing, China

fYear

2011

fDate

25-27 June 2011

Firstpage

1

Lastpage

6

Abstract

In this paper, with the sample data of VC-backed and non-VC-backed IPOs listed in Shenzhen Stock Market during the period from Sep. 25th. 2009 to Sep. 17th. 2010, the two traditionally considered certification and grandstanding roles of venture backing in IPOs in Chinese Stock Market is empirically examined. These overall empirical results show that: at time of the medium-small-sized enterprises´ going public in China, the effect of number of venture capitalists and ratio of the venture capitalists´ shareholdings to IPOs shares on both the level of IPO underpricing and issue cost aren´t obvious. There is no evidence to support that the venture capitalist specialize his investments in firms to provide either intensive certification services or grandstanding services.

Keywords

small-to-medium enterprises; stock markets; venture capital; Chinese stock market; Shenzhen stock market; VC-backed IPO; certification services; grandstanding services; investments; medium-small-sized enterprises; non-VC-backed IPO; venture capital; venture capitalist; Certification; Companies; Industries; Investments; Monitoring; Stock markets; Venture capital; IPO; certification hypothesis; grandstanding hypothesis; venture capital;

fLanguage

English

Publisher

ieee

Conference_Titel

Service Systems and Service Management (ICSSSM), 2011 8th International Conference on

Conference_Location

Tianjin

ISSN

2161-1890

Print_ISBN

978-1-61284-310-0

Type

conf

DOI

10.1109/ICSSSM.2011.5959395

Filename

5959395