A Study On The Mechanism Of China's Venture Capital Exit

Nowadays the world has become a knowledge economy world. In the course of development of modern economy the high-tech plays an important role. And venture capital is an important lever to make high-tech industrialize, to develop the technological venture enterprises, to hatch a new economy increasing point, to modulate the structure of industry quickly. The experiences of development of modern economy of different nations have shown that venture capital was important to ensure the economy to increase stably, quickly and healthily. The new economy of America is a best example. Just like the professor Anderson of MIT said"No venture capital, no new economy of America".Venture capital exit is the most important part of the whole venture capital process. The venture capital market will not attract more venture capital unless the capital can exit from the investment project smoothly. If the venture capital can enter a well recycling course it will facilitate the development of economy. It was known that the advanced venture capital exit mechanism of oversea nations had contributed much to the development of one nation's economy and venture capital.This paper describes the venture capital exit mechanism from both macro and micro insights. From the macro point of view this paper analyzes the experiences and inspirations of venture capital exit of developed nations or regions. Then we discuss that there are some limits to the exit of venture capital of China in law and system aspects. The paper gives some pieces of advice to solve the problems of venture capital exit in China as well. In micro we analyzes the main exit ways of venture capital including IPO, M&A, buy-out and write-off .The efficiency of the exit ways and the appropriate time of exit have been discussed. And we build a model of decision-making of venture capital exit too.The paper is composed of four chapters.Before the chapter one is the introduction. It gives a brief introduction of the paper including background, contents, researching ways, some related papers, the innovation and disadvantages of the paper.Chapter one focuses on the analysis of the theories of venture capital exit. Firstly,the importance of venture capital exit is analyzed. Secondly, the main exit ways of venture capital are described. And we research the most appropriate time of the exit. At last we build a model of decision-making of venture capital exit. Chapter two shows us some experiences and inspirations of some developed nations'or regions'venture capital exit. These nations or regions include the USA, Britain, Japan, Taiwan of China and Hongkong SAR of China. Chapter three concentrates on the evolution of development of venture capital in China. And the problems of exit of venture capital in China are analyzed. Chapter four is the key of this paper. In order to solve those problems of venture capital exit in China some suggestions are discussed from the aspects of system, policy and law. At last it is the conclusion of this paper.