Reference And Development - China's Venture Capital Operation Mechanism Of

Venture capital refers to the investment activities of providing equity capital to small and medium-sized businesses that develop and industrialize high and new technology and withdrawing fund and obtaining profits through equity transfer.In a time when science plays a leading role and knowledge economy is the main trend, whoever masters the high and new technology may become leader in economic development and occupy a dominant position in international competition. Venture capital is the very form of financial innovation to suit the need of this fundamental tendency. First, venture capital can gather public fund to support the scientific and technical innovation and industrialization of a nation and raise the contribution of technical progress to economic development; secondly, through the evaluation and scanning system of venture capital market, the industrial structure of the national economy will be optimized, and thus optimize capital, technology and human resources ; thirdly, as the incubator of the high and new technical enterprises in their bud, venture capital will foster a large number of small and medium-sized businesses with advanced technology, products of high additional value and ability to survive environment of intense competition so as to improve the enterprise structure of the national economy and strengthen the vitality, flexibility and adaptability to economic crisis. And last, venture capital is an innovation for traditional financial structure. In spite of the rapid economic development of China since it adopt the policy of reform and opening-up, the competitiveness of its science and technology has dropped continually in international market, which sharply reflects the parodox of the insufficient and extensive growth of Chinese economy. So we must transfer our focus on technical advancement and the economic results yielded from it. To develop China's venture investment is an important step to make this transfer. This thesis is classified into three parts according to the above-mentioned ideas: Part I. To discuss the necessity and urgency of developing venture capital in China through the research of the reasons behind the financial crisis and the analysis of China's scientific industrialization and related systems of investment and capital finances; Part II. To introduce the connotations and mechanism of venture capital. Part III. To discuss the role of government in establishing the venture capital market in respect to regulations and laws, policies, and other factors, and offer a proposal for the development of China's venture capital with the focus on the construction of venture capital market.