Research On The Motivation And Economic Consequences Of High Cash Flow Of Listed Companies Held By Venture Capital

venture capital,an outcome of financial market at a certain period,originated from developed countries in 19 th century and be gradually brought into China until1980 s.For the past few years,venture capital has become the crucial component of capital market in China and play a vital role to boast the development of high-tech industry.The operation process of venture capital mainly includes four stages of "raising,investment,management and exit",of which venture capital exit is the final step to gain return on investment and the key element to make venture capital a success and the endless power to make venture capital invest circularly.Due to venture capital starts late in China and still stay in the primary development stage at present,it has not yet formed a set of mature complete theory system.This situation makes the problems like difficult exit still exist in part of venture capital.Therefore,the option of choices at this stage studies the venture capital exit way choice and the economic consequence which brings has the very important realistic significance.This paper analyzes it’s topic by the combination of literature review,case study,and event study.In this paper,there are four different ways of exit which will be compared and analyzed by consulting the existing research data.The real case that Fortune exited from Capital Sinosun will be analyzed to know the main influences of choice of venture capitals well as the economic consequences under the current special market environment in China.This paper will table a proposal for venture investment agencies that how to choose the best exit way and provide experience for other venture investment agencies.This paper is divided into five parts: the first part is the introduction,which describes the research background,research purpose and research significance,summarizes the existing literature research and makes a simple literature review.The second part is the related concepts and theoretical basis,mainly introduces the related concepts of venture capital and venture capital exit,as well as the related theories,which lays the theoretical foundation for this paper.The third part mainly describes several different venture capital exit methods and case background,then introduces the relevant information of Fortune Capital and Sinosun,and briefly introduces the process of Fortune Capital choosing IPO Exit method.The fourth part is the analysis of Fortune Capital’s motivation,timing and mode of IPO Exit.The fifth part describes the economic consequences of the exit of the case.The sixth part is the conclusion of the case study and the suggestion of enlightenment.It summarizes the conclusion of this study,puts forward some reference suggestions and prospects forthe choice of exit ways of domestic venture capital.Based on the way of venture capital exit and the economic consequences of case study,the author get the following conclusions:(1)the choice of the ways of venture capital exit is closely related to exit return on investment,in general,from the exit earnings perspective,IPO exit is still the most common and most popular exit way;(2)IPO exit of venture capital will have certain economic impact on both parties involved.For venture capital institutions,it can improve investment performance,relieve financial pressure and promote their sustainable development and so on.For venture enterprises,the final exit of venture capital may have a negative impact on their short-term stock market performance,and the stock price will show a short-term downward trend.