| Recent years, economic decline and unemployment generate a great demand of entrepreneurial financing in China, which forces Chinese Government gradually loosing enter regulation and reforming financial system. Almost at the same time, social entrepreneurship and innovation are becoming the new phenomenon and engine of china’s economic growth. Compared with the past, China’s entrepreneurial financing environment has been greatly improved, but the legal obstacle is also the first restraining factor. In 2014, Alibaba, as a typical Chinese entrepreneurial venture enterprise, made a success listing in America. Unlike other Chinese companies, Alibaba is especially capable of entrepreneurial financing all the way. So, how Alibaba legally safeguard its entrepreneurial financing? In this article, Alibaba will be analyzed as a classic case from the perspective of government-enterprise game. combined with the external legal environment, a dynamic observation will be conducted over its 16 years’ history. Alibaba’s strategy and legal safeguard will be studied according to its regulation pressure at three different stages, and the potential influence on the outside legal system development also will be discussed.The structure of this paper has 4 parts. In Part 1, firstly reviews the whole legal regulation background of entrepreneurial financing and strategies widely used by enterprises to circumvent government in the past decades. Secondly, the rigid regulation of foreign investment and Alibaba’s VIE structure will be followed. Finally, the substantial risks posed by Alibaba’s venture financing, such as exit and acquisition pressure separately from VCs and competitors. Part 2 discusses the legal risks and strategies in Alibaba’s rapid growing period. The legitimacy pressure of VIE forces Jack Ma to conform with Government’s authority and the regulation of China’s central bank. In order to repurchase the remaining shares from Yahoo, Alibaba began to cooperate with China government and Chinese funded investing institutions. And then IPO pressure and defects in the capital market jointly stimulate Jack Ma to design a Partner System. Part 3 will focus on the legal obstacles and strategy used before and after Alibaba’s American IPO. At first, Alibaba’s Partner System experienced a difficult and long negotiating process with regulators in HK, but all efforts made by Jack Ma and his team came to a failure. And therefore Alibaba used strong political relations to relieve regulatory pressure in China and America, but political relations soon push Alibaba into great trouble after its IPO. Part 4 is a short conclusion. |
PDF Full Text Request