China’s Research On The Development And The Exit Of Venture Capital

This paper firstly introduces the conception and characteristics of venture capital,and emphasis the importance and the necessity of developing venture capital. Then this paper analyses the determninants of venture capital market development, using Vector Auto regression.The factors which influence the development of venture capital market are GDP, CPI,law, technology and human capital. The empirical result shows that:technology can promote the development of venture capital market, and with the development of venture capital market, it is good to raise the capability of innovation of China. The performance of stock market can influence the development of venture capital market in theory, but cannot be tested by empirically.There are several ways for venture capital to exit:IPO, M&A, second sale and write off. This paper explores the factors that are considered in choosing which way to exit venture capital from the view of the environment of exiting venture capital. These factors are GDP, the amount of money, the return of stock market and the establishment of Growth Enterprises Market. Through analyses with these factors by using linear regression model.This paper find that the increase of GDP can raise the percentage of choosing IPO to exit venture capital, the increase of money supply can promote venture capital to exit through the way of IPO and the good performance of stock market can also result in the increase of IPO.At last, This paper analyses Chinese venture capital market,and give some suggestions to the government.