The Role Of Venture Capital In Subsequent Debt Financing Capacity Of Listed Companies

With the rapid development of venture capital, the research about the role of venture capital has become a hot area of the domestic and foreign scholars. However, there are still some deficiencies in these above researches. Especially, the research about the influence of venture capital to the enterprise in debt financing capacity and the research about the role of venture capital on listed companies have been in a state of blank. In order to perfect the theory of the role of venture capital and provide some new ideas for enterprises’ debt financing difficulties at the same time, this paper is dedicated to discuss the role of venture capital on listed companies in debt financing capacity in post-market stage.This paper argues that the participation of venture capital will significantly improve enterprise’s debt financing capacity at post-marketing phase. On one hand, the presence of venture capital in company not only can transmit positive signals to outside world by the "Certification Role", but also can supervise enterprise, reduce the information asymmetry of venture capital backed companies by participating in enterprise daily management; On the other hand, to maximize themselves interests, venture capital institutions will try to prevent outside equity investors from diluting its return on investment; so that they would encourage the enterprise they invested to get debt financing when venture capital backed enterprise make financing decision. In order to study the above-mentioned relationship deeply, this paper firstly compare venture capital backed companies with non-venture capital backed companies in the corporate’debt financing situation; and then on the basis of that, we will consider the mechanism that how the heterogeneity of venture capital influence the corporate’debt financing capacity. This paper chooses about five characteristics of venture capital in all:venture capital shareholding ratio, whether venture capital invests in joint, whether venture capital institution is state-backed, whether the members of venture capital institutions act as the directors, supervisors or senior executive of venture capital backed companies and whether venture capital invests in stages.This article selects the companies which go to list on the Shenzhen Small and Medium-sized Board and Growth Enterprises Market during2004-2011as our samples. In the above samples, there are254venture capital backed companies and457non-venture capital backed companies. We use these samples to establish regression model to give a systematic empirical study, and the ratio of interest-bearing debt financing to total assets (beginning balance) as the dependent variable. The results show that:(1) the venture capital institutions have obvious influence on corporate debt financing capacity. Specifically, relative to the non-venture capital backed companies, the venture capital backed companied will get more about1.84%interest-bearing debt financing under the same condition;(2) the different investment characteristics of venture capital will make enterprise interest-bearing debt financing capacity has different change. That is, the heterogeneity of venture capital would cause some different effects on the enterprise’interest-bearing debt financing capacity. It is worth mentioning that whether the members of venture capital institutions act as the directors, supervisors or senior executive of venture capital backed companies has the greatest impact on the enterprise’s interest-bearing debt financing, among the above different investment characteristics of venture capital;(3) in order to guarantee the reliability of above results, this paper also uses some methods, such as Heckman two-phase Model, Propensity score matching method and so on to make robustness test and endogenous test, finally find that the results remain consistent. It means that the role of venture capital can be extended to the post-marketing stage, even can be extended to the corporate debt financing.