Study On The Relationship Between Financial Structure And Growth Of Technology-based Small And Medium Company

The government and social community pays more and more attention on small and medium sized enterprises’(SMEs) growth. From financial point of view, reasonable capital structure plays a very important role in SMEs’ scale expansion, market competitiveness enhancement and future performance improvement. There are large numbers of studies on the influence factors of enterprise capital structure at home and abroad. Domestic researchers carried on thorough discussion about SMEs’ growth evaluation index system. But there is still no consensus conclusion about the relationship between the capital structure and enterprise growth. Now SMEs in China face financing difficulties and high financing costs. So it is very important to adjust SMEs’ capital structure and use internal and external capital reasonably and efficiently.This Research introduced domestic and foreign literature review of the relation between SMEs’ capital structure and growth. The author analyzed the relationship between SMEs’ growth and capital structure in different stages based on the capital structure theory and characteristics of SMEs. The research sample are 210 technology-based SMEs selected from listed firms in Shenzhen and Shanghai. The author established multiple linear regression model and focused on the analysis of technology-based SMEs’capital structure and growth relationship in the start-up stage, growth stage and mature stage. Asset-liability ratio and long-term asset-liability ratio are selected as the indicators of enterprise capital structure. Total assets growth rate are chosen as technology-based SMEs’ growth variable. To ensure the research significance of the empirical results, rate of return on common stockholders’ equity(ROE), enterprise scale, age, fixed assets ratio, intangible assets ratio and R&D input intensity are added into regression model as control variables.The empirical results show that technology-based SMEs’ growth is negatively related to the asset-liability ratio and long-term asset-liability ratio, but the latter relationship is not significant. The relationship between SMEs’ growth and the proportion of top ten shareholders is positive. Enterprise scale is positive related to the technology-based SMEs’ growth. The relation between ROE and technology-based SMEs’growth is positive. Small and mid-sized enterprise fixed assets ratio and corporate growth has significant negative correlation. Intangible assets ratio is negative related to SMEs’ growth. And R&D input intensity is positive correlated to SMEs’ growth. In addition, the asset-liability ratio of high-tech Small and mid-sized enterprise generally at low levels. Technology-based SMEs should bring out potentials of the debt financing in corporate tax avoidance and agency costs reduction. And High-tech SMEs need to timely adjust capital structure in different stages of small and mid-sized enterprise growth in order to realize SMEs’ high-speed development in the future.