Do VCs try to effectively perform their functions on entrepreneurial firms? Based on the data of the listed companies in Shenzhen GEM

摘要

Do VCs try to perform their functions to screen and foster enterprise firms in China? Based on the data of the listed companies in Shenzhen Growth Enterprise Market (GEM), our empirical study gets some interesting implications. First, VCs do not prefer to invest in companies of better financial performance. Second, the capital market does not appreciate the companies with VC background, but rather depreciate the companies at the time of IPO. Third, after IPO, VCs do not effectively improve the operating performance of their investment object. The result shows that VCs might not effectively perform their essential functions in China.