The Study Of The Effects Of VC/pe's Characteristics On Overseas-listed Chinese Firms' IPO Underpricing

Many high-tech firms in China can't meet the requirements of China Stock Market.These firms chose to IPO on NASDAQ and NYSE in support of VCs.In this paper we will take on research on the IPO underpricing degree according to the overseas-listed Chinese firms.We will find out if there are any connections with VC-background and characteristics.The sample of this research is the 119 companies listed between Jan1^st.2006 and Dec 31^st.2015 on the NASDAQ and NYSE.The final results show that,VC-background and charateristics such as VC's reputation and equity ratio have significant effect on the IPO underpricing.VC-background firms'IPO underpricing degree is significant smaller than non-VC-background firms.But whether the VC chose to sell some equity in IPO or not has nothing to do with the underpricing degree.The VC with high reputation can significant reduce the IPO underpricing degree.But with the equity ratio increases,the underpricing degree increases too.If the VC-background firms were divided into two groups by the reputation of the investment bank,we'll find the coefficients of three variables have significant changes,which means the reputation of investment banks affects the VC's action.