Research On The Correlation Between Venture Capital, Equity Concentration And Enterprise Value

According to the previous research results on venture capital, some scholars think that risk investment agency participation helps value add of invested enterprises. That is because that venture capital can provide value-added services, enhance regulations and improve management to add enterprise value. The GEM listed companies are high risk, high yields and high growth, so most of them have the risk investment institutions participation. Ownership concentration can affect market action and value creation of enterprises invested. The paper studies on the relationship between the proportion of VC shareholding and enterprise value of invested enterprises. And I pose the following question: whether corporate value increasing of the VCs’ backgrounds is higher or lower than average the non- VCs’ backgrounds? What is the relationship between shareholding concentration and corporate value increasing on the GEM? How does the proportion of VC shareholding affect value add of invested enterprises?For these problems above, the paper combines both normative analysis and positive analysis to explore the relationship of VC, ownership concentration and enterprise value. Meanwhile, I use the system of EVA on enterprise value measurement. First, EVA can avoid errors between calculation results and real results. Second, EVA can optimize the corporate governance structure and improve the remuneration system and incentives. But above all, EVA can help input innovation capital and rationalize investment decisions.It is found that corporate value increasing of the VCs’ backgrounds is higher than average the non-VCs’ backgrounds; Comparatively, decentralized shareholding concentration is more conducive to increase corporate value on the GEM; There is relationship of inverted U pattern between VCs’ ownership concentration and corporate value increasing.Basing on the above research conclusion, the author puts forward three suggestions:(1)To form reasonable shareholding concentration.(2) To regulate the GEM and establish legal environmental for protecting investors.(3) To perfect the information disclosure system on GEM.