Investor Intervention, Heterogeneity And New Venture Growth Performance

Start-up financing corporate governance has been one of the core issues in entrepreneurial practice and research, but most of the study is given priority to with qualitative theory research, and although we have got rich achievements but there is no unified conclusion about relationship between investors intervention type and enterprise performance. The traditional research on the governance of relationship between entrepreneurs and investors is largely based on agency theory, and research questions mainly focused on using rules and regulations to reduce agency cost and improve enterprise performance. But the relationship between investors and entrepreneurs in startup is different from that in mature enterprise. The coming of different types of investor triggers heterogeneity between entrepreneurs and investors, then causes potential conflicts of interest and cognitive differences, and thus brings agency cost and the cognitive cost and cognitive value. The existing corporate governance system ignores the heterogeneity between entrepreneurs and different types of investor and its governance in start-up. Because of the importance of cognitive problems caused by heterogeneity, researches on corporate governance of relationship between entrepreneurs and investors based on the perspective of cognitive differences put forward a huge challenge to the mainstream research on the basis of agent theory.Given this, we first reviewed the previous literature about start-up financing corporate governance, and then based on heterogeneity theory, attempted to exploratory the influence mechanism of investors intervention, intervention types and heterogeneity between entrepreneurs and investors affect the new enterprise in the perspective of cognitive governance.355 Chinese Growth Enterprise Market (GEM) Listed Companies are taken as a whole sample to verify our hypothesis. The result shows that:Firstly, the task-related heterogeneity between investors and entrepreneurs is of significant differences due to different types of investor intervention; Secondly, the growth performance varies with types of investor intervention, because outside investors can have a positive impact on the growth performance of new enterprise and the performance is especially good when business angle and venture capital invest together. Thirdly, the task-related heterogeneity between investors and entrepreneurs play a positive role in promoting the growth performance of new venture. Finally, the heterogeneity between entrepreneurs and investors is an important mediator between investor intervention and growth performance.This paper provides a new perspective to study start-up financing corporate governance and make up for lack of related research in China. Based on the data of Chinese GEM Listed Companies, we find the influence mechanism between investor intervention and new venture growth performance, namely heterogeneity between entrepreneurs and investors. It’s not only a powerful supplement for empirical research in the field of start-up financing corporate governance, but also provides a strong theoretical and practical guidance for Chinese entrepreneurship practice.