Research On The Location Choice Of Foreign Venture Capital In China And The Countermeasures For Zhejiang

In general, the mature foreign venture capital can greatly improve the investment environment of local venture capital and its operating efficiency. China has currently become a country which has the largest net flow of venture capital from all over the world. In 2008, the venture capital led by foreign VC institution accounts for 76% of the total venture capital in China. Now there are 39 venture capital firms counting 1 foreign VC firm in Zhejiang. What's more, very few VC investment projects can be found in Zhejiang compared to those places such as Beijing, Shanghai, Jiangsu, Guangdong, etc. Evidence that VC investment can boost the economy of Zhejiang province has not yet been found. It remains before us an urgent question to answer which is how do we attract high-quality cross-border foreign venture capital so as to improve the VC investment activities in Zhejiang. However, the research of cross-border venture capital is very limited now at home and abroad, which has lagged far behind the pace of the cross-border VC phenomena. The existing studies are mainly focused on the general description and developing trend of cross-border VC. Therefore, in order to recognize the precondition, strategic motive and location choice of foreign venture capital in China, it's necessary to put forward a more comprehensive and targeted theoretical mechanism.The main contents are: First, it clarifies the strategic motive, resources integration means and local choice of cross-border venture capital on the basis of the strategic resource integration theory; Secondly, it builds the model for location choosing of foreign venture capital in China and chooses proper indicators as well as quantifies the decision-making procedures based on the current situation of China; Thirdly, it gives a thorough analysis from macro-level on how location advantages of 32 main provinces and cities differ from each other in attracting foreign VC, then it carries out a typical case study of IDG , the earliest VC firm to enter China's market, and analyzes IDG's strategic motive, entry mode, and location choosing reference; Finally, it gives applicable advices by drawing upon the advantages and disadvantages of attracting foreign venture capital in Zhejiang Province as well as the successful experience from other regions, thus to improve the capability of attracting foreign VC in Zhejiang. The main research methods in the paper are: system analysis, measurement analysis and case analysis.The theoretical significances of this study are: First, it applied strategic resource integration theory to analyzing cross-border venture capital, so as to enrich and expand the traditional FDI theory. Second, it builds a model for location choosing procedure of foreign venture capital in China, which provides strong theoretical basis for analyzing the location choosing of the foreign venture capital in China. The practical significance is that it provides scientific theory and method guidance for attracting foreign venture capital into Zhejiang and our country as a whole .What's more, it helps to forge effective countermeasures on the basis of knowing our disadvantages, thus to serve the"entrepreneurship and innovation strategy"in our province.