Analysis On The Function Of Business Plan Competition

In 1998, the business competition was firstly held by the entrepreneurial association of Tsinghua University. Since then, this form of business plan competition caused a huge reverberation and raised an upsurge. Through this competition mode, we find out that there are so many excellent entrepreneurs and new enterprises come out. Furthermore, so many venture companies begin to pay their attention on it. The CCTV firstly fronted for a new show called "winning in China" last year. This show which is successfully combined with the media causes the social attention abroad. And also it causes a great many of successful VC cases.The problem of information asymmetry is the extrusive one of the problems that affects the possibility of VC case success. As the entrepreneurs, they own more information about their project and their own ability than the venture investors. They have got the private information which is missing to the venture investors, and this would cause the converse choice problem. Due to it, the mode of business plan competition supplies a better way of solution. Through the models of signal transferring and information distinguishing, the article is about to theoretically explain the function of the business competition. After the study, we find that the information exposure mechanism take a good point.