A Study On The Special Ownership Structure Of Emerging Enterprises

With the rise of emerging enterprises,practitioners and academics generally recognize that elements like new technologies,unique business models and entrepreneurial founding teams are beginning to play more and more important roles in the process of enterprise development.A worthwhile question is how the special ownership structure varies in different stages of emerging companies from a macro perspective,and how it influences corporate governance.This article takes Alibaba's partnership system as an example to study this special equity structure with unequal voting rights.The paper discusses the reason of why this kind of special equity structure prevails in emerging companies.Further,the paper explores the nature and the influence of special equity structure.The main points of this paper are as follows:First,this article argues that Alibaba partnership is a creative design of ownership structure.Its direct reason is the dispute over control of founders' team and the fund owner.Besides,other contributing factors include founder's entrepreneurial spirit and prestige,and human capital.Second,based on the theory of incomplete contract,this article expands its theoretical hypotheses.In 21st century,technology and innovation challenge the incomplete contract between founders and capital owners.In the light of a bilateral moral hazard model,this paper proposes a model driven by capital and technology and considers special equity structure as a transient balance between the founder and other factor providers.Third,under the new incomplete contract,the different voting rights designed by special equity structure will lead wild capital invaders and inside control driven by technology to become new corporate governance problems.The incomplete contract theory is developed in the practice of emerging enterprises.Finally,this article conducts a comprehensive international comparison of the relevant regulatory policies,arguing the Chinese A share temporarily does not suit kinds of special equity structures.However,the paper argues the government should positively explore the regulations on special equity structures,in order to suit the "mass innovation and business start-ups".Besides,the recent debate about the "unicorn"reflects the callings for the trend.