Evaluation Research Of Venture Capital On Internet Project

The venture capital has promoted the development of a large number of companies, suchas Google, Intel and Baidu and so on, since it was born. The VC came to our country in1980’s, it has through initial, explosion already and now in a period of adjustment, which willbe long time. In today’s high-speed economic development, the industry of VC is faced withfunding limitations, lacking investment strategy and the difficult of valuing theEntrepreneurial Enterprise; in the other hand, the state encourages youth and graduates toestablish a business. So there are more and more VC projects, how investment organization orinvestor to select from them is a big crisis. Thus the evaluation research of venture capitalproject will be of significant importance.As the internet is one of the greatest inventions of20th century, now it is coming into ourlife and changing our life style. After the shock of internet, entrepreneurs are aim at thismarket. According to the data of second quarter in2013, the29investments are internetprojects, among the89cases, it has accounted for23%. For the internet project more andmore attracted the attention of VC, combining internet project and VC to study the evaluationcould help VC organization improve the efficiency, promote the development of the industry,and make the contribution to economic growth.The academia has done lots of research about Hi-tech venture capital in recent years, butthe research results was lack of specific in that the research was not subdividing into thespecific industries. The contents of this research mainly include three aspects: First, throughthe combination of the characters of the internet industry, the evaluation index of internetventure capital project is designed by logical analysis method and factor analysis method. Second, the BP artificial neural networks are built as the evaluation method of internetventure capital project. Third, a case study was given to validate, at the same time, thesuggestions are given to participants in VC industry.The research shows that there are six first class indicators and13second class indicatorsin the evaluation index of internet venture capital project. These first class factors areentrepreneurs, product, market, technology, business and environment. The BPartificial neural networks are built as the evaluation method of internet venture capital project,the accuracy of the evaluation model is validated by three cases. The suggestions that given toparticipants in VC industry include three aspects: first, the13indicators is the key referencewhen venture capital investment organization assess the internet projects. Second, the VCinstitutions should perfect the evaluation system of venture capital across all industries. Thefinal, Internet start-ups should build the system of self-examination according to the paper.