An Empirical Study On The Performance Of Venture Capital Institutions

With the development and deeply opening to the other countries of financialindustry, it has become increasingly prominent, and it is significant to look it as ameso level independent industry to develop. As the bridge and link connecting theinnovation of science-technology and financial capital, Venture Capital investment isconsidered as the “engine” or “booster” of promoting high-tech industries to emergeand high-speed growth. On the one hand, VC promotes the financing environment anddevelopment for small and medium-sized technology-based enterprises, in the otherhand, it also had provided a more broad space for the development of building themulti-level capital market in China.VC will be researched as a special industry with the industrial organization theoryframework in the paper, I will have a in-depth study to shanghai`s venture capitalindustry combining qualitative and quantitative analysis. Firstly, the SCP(structure-behavior-performance) paradigm will be discussed whether can be appliedin the financial field; Secondly, it will analyze the VC market and industry features ofshanghai with SCP paradigm; Thirdly, combined with the actual situation of VCmarket, the traditional SCP will be modified, and the empirical model about thestructure and behavior factors of VC enterprises effecting their performance will bebuilding through the new SCP, and then going to empirical analysis with “thetheoretical demonstrating+performance model+factors parallel model”; Finally,putting forward the related policy suggestion according to the conclusion andproblems reflected, so that promotes the healthy development of venture capitalindustry.According to analyze the characteristics of Shanghai venture capital industry inChina through the market structure-conduct-performance, we can draw: In themarket structure, the Shanghai venture capital institutions concentration is relativelylow, belongs to a low concentration of oligopoly; Venture capital sources mainly getfrom government, state-owned and private enterprises, and the project sources arefrom friend introduction, intermediary agencies and government departmentsrecommend. In the market behavior, institutional investment industry maintained a"diversified" feature, and mainly concentrated in the star-up period and growingperiod. In the market performance, venture capital institutions`average businessincome increases year by year, and the equity transfer remains the main method ofincome source; Although Shanghai VC agencies’ share repurchase has increased, but the exit still focuses on the way of IPO and merger.For the different industries, especially about the finance, the SCP paradigmshould be modified with its characteristics of certain amendments before applicationand empirical studying rather than directly blind used. This paper uses the modifiedSCP paradigm to empirical analysis and draw these: The performance of venturecapital institutions has no direct relationship with market concentration, and isinversely proportional with the scale of capital management and stage investment, sowe can see that Shanghai venture capital management scale with the operation has notyet reached the best "match point", there is still a certain information asymmetry;While Venture capital performance by government holdings is relatively low, ithighlights by side that the state-owned system has some marginalization, lacking ofmore perfect performance evaluation and incentive; From the investment stage andthe industry perspectives, the existence of positive correlation between performanceand investment stages of enterprises and engaged in the industry is significant, itshows that the specialized investment can strengthen the understanding to someparticular industry or stage, which can reduce the uncertainty of investment, at thesame time, the affection to the performance by investing high-tech industry is largerthan investing traditional industry, therefore, the Shanghai venture capital institutionsshould pay more attention to the professional investment, so giving particularattention to the high-tech industry is necessary.