Corporate Venture Capital And Enterprise's Innovation

As Chinese economy transforming from extensive growth to intensive growth,innovation is becoming increasingly prominent in our economy.Existing research suggest that venture capital(VC),as high-risk and high-yield investors,could provide capital and stimulate enterprises' innovation.Corporate venture capital(CVC)first appeared in USA in 1960s.Although started late,it developed rapidly and has played an important role in capital market.As a special form of VC,does CVC have different effects on enterprise innovation compared with traditional venture capital(IVC)?Studing 2004-2014 listed companies in Chinese SME and GEM board,we manually determine whether companies have VC background or CVC background.We mainly focuse on the relation between CVC support and enterprises' innovation,and also try to explore possible mechanism between CVC support and enterprises'innovation from aspects of corporate governance and corporate strategy.The empirical results show that:Firstly,compared with IVC,enterprises with CVC background are more innovative.Secondly,from the point of corporate governance,whether the relation between CVC support and enterprises' innovation is related to CVC alleviates or brings agency problems is unsure.Finally,in terms of corporate strategy,CVCs'resource support is one of the reason why enterprises with CVC background are more innovative,and the innovation is not from CVCs parent company's innovation spillovers but related to their own innovative demands.The contribution of this essay are as follows.Compared with rapid development of CVC,the research on CVC is rare,especially in emerging markets.This paper studies the impact of CVC on invested enterprises' innovation,which provides a typical empirical evidence in emerging market.In addition,this paper attempts to explore possible mechanism between CVC support and enterprise innovation from perspectives of corporate governance and corporate strategy repectively.