China Venture Capital Exit Mechanism Research

In recent years, as China’s economic development and the capital market isincreasingly perfect, China Venture Capital has developed rapidly. In2009the launch ofShenzhen GEM(Growth Enterprises Market), risk investment for the exit has opened up anew channel. Since2009, through the gem of risk investment case from realize more andmore, and for risk investment agencies brought high investment return.Exit is Venture Capital to the circulation of the key, it is both the past the end of theVenture Capital behavior, is new Venture Capital behavior of the starting point. Venturecapital with the risks of enterprise growth and won the value, but if there is no proper exitchannel, the appreciation of the value of the book is on, only completed the effective exit,can realize the book value into real earnings growth, such as venture capitalists tosnowball, will more money to the next risk project, realize the virtuous cycle of capital.This paper first introduced the Venture Capital, Venture Capital exit mechanism ofmeaning and function, and analyzes the Venture Capital exit mechanism are the mainfactors, basically have macro economic cycle, capital market environment, transactioncost, risk investment institutions to establish the length of the time. The Venture Capitalfrom developed countries model for the research and analysis, and the conclusion thatventure funding for China’s development of the enlightenment. Then the author to ourcountry the Venture Capital development and exit this paper introduces the presentsituation, and analyses the background of the Venture Capital enterprise IPO condition.Then the author from the point of view of the real option risk investment to withdrawfrom the things, through the introduction of profit flow as venture capital withdraw fromthe endogenous variable, establish the Venture Capital exit time and exit decision controlmodel of the way.This paper studies the conclusion that the following conclusions:①venturecapitalists should first opt-out method, and then opt out of the opportunity.②If theventure capitalists are expected stream of profits in the investment cycle will be more thana critical value, the exit is the best choice by way of publicly listed, and profit flowreaches its maximum for the optimal exit timing.③If the venture capitalists are expectedstream of profits in the investment cycle will not be able to exceed a certain threshold, exit is the best choice for resale, and profit flow reaches its maximum for the optimal exittiming.