Risk Mitigation Strategies of Foreign Venture Capitalists in China

45 Pages Posted: 7 Jul 2008

See all articles by Qianqian Du

Qianqian Du

Hong Kong Polytechnic University

Ilan Vertinsky

University of British Columbia (UBC) - Sauder School of Business

Date Written: July 2, 2008

Abstract

We developed a theoretical framework which articulates the relationship between global and local experiences of the venture capitalists investing in China and the risk mitigation strategies they employ. We predicted that venture capitalists with little experience are more likely to join syndicates. We also predicted that the relationship between late stage strategic focus and VCs' global and local experiences is positive. We tested our hypotheses using database covering all first round venture related investments made by foreign VCs in China until Oct 2006. Controlling for a variety of factors our data supported our predictions.

Keywords: Venture capital, China, Risk mitigation strategy

JEL Classification: G24

Suggested Citation

Du, Qianqian and Vertinsky, Ilan, Risk Mitigation Strategies of Foreign Venture Capitalists in China (July 2, 2008). Available at SSRN: https://ssrn.com/abstract=1154809 or http://dx.doi.org/10.2139/ssrn.1154809

Qianqian Du (Contact Author)

Hong Kong Polytechnic University ( email )

9/F, Li Ka Shing Tower
The Hong Kong Polytechnic University
Hong Kong, Hung Hom, Kowloon M923
China

Ilan Vertinsky

University of British Columbia (UBC) - Sauder School of Business ( email )

2053 Main Mall
Vancouver, BC V6T 1Z2
Canada
604-822-9406 (Phone)
604-822-8477 (Fax)

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