The Influence Of Introduction Of External Investors On The Arrangement Of Founder's Control Rights To The Internet Enterprise

In recent years,the problem of losing founders' control right of Chinese internet enterprises has become a hot issue.At the initial stage,Internet enterprises rely heavily on the intellectual factors of their founders in technology research and market expansion.As a result,the founders take fully control of these enterprises.However,when internet enterprises step in the fast growing period,they have a great demand for funds,which forces the founders to solve the development dilemma of internet enterprises by introducing foreign investment.Although the pressure of shortage of funds is relieved,there is a new problem—the basis of the founders' control right of internet enterprises has changed.The founders face the crisis of losing control of their enterprises.In this paper,equity capital based on financial resources,social capital based on relational resources,human capital based on knowledge resources and institutional design are taken as the source of the founder's control right.How the external investor affect the Internet founder control,and how the founder maintain their own control amid the impact are under the discussion.Through the case study of Alibaba,this paper argues that a reasonable equity structure arrangement can solve the problem of who will invest,who will do,who will benefit and who will be responsible for Internet enterprises,fully assess the contributions,interests and rights of shareholders to the enterprise,avoid corporate equity deadlock or disputes,and achieve a win-win result between the enterprise and the stakeholder,especially the founder and the external investor,so that the enthusiasm of the shareholders can be fully mobilized to help enterprises move to the capital market smoothly while ensuring the control to the enterprise of the founder or founder team,and eventuallyachieve the goal of rapid growth.This paper enriches the contents of corporate governance of internet enterprises,which is meaningful to the development of Chinese Internet enterprises and the Internet industry.