Qing Yao, Shaodong Ma, Jing Liang, Kim Christensen, Wanru Jing, Ruiqi Li
arXiv 2 Nov 2022 · physics.soc-ph · 1 citations (OpenAlex)
arXiv:2211.00873 · PDF · DOI · OpenAlex · Extracted main text
The Chinese venture capital (VC) market is a young and rapidly expanding financial subsector. Gaining a deeper understanding of the investment behaviours of VC firms is crucial for the development of a more sustainable and healthier market and economy. Contrasting evidence supports that either specialisation or diversification helps to achieve a better investment performance. However, the impact of the syndication network is overlooked. Syndication network has a great influence on the propagation of information and trust. By exploiting an authoritative VC dataset of thirty-five-year investment information in China, we construct a joint-investment network of VC firms and analyse the effects of syndication and diversification on specialisation and investment performance. There is a clear correlation between the syndication network degree and specialisation level of VC firms, which implies that the well-connected VC firms are diversified. More connections generally bring about more information or other resources, and VC firms are more likely to enter a new stage or industry with some new co-investing VC firms when compared to a randomised null model. Moreover, autocorrelation analysis of both specialisation and success rate on the syndication network indicates that clustering of similar VC firms is roughly limited to the secondary neighbourhood. When analysing local clustering patterns, we discover that, contrary to popular beliefs, there is no apparent successful club of investors. In contrast, investors with low success rates are more likely to cluster. Our discoveries enrich the understanding of VC investment behaviours and can assist policymakers in designing better strategies to promote the development of the VC industry.
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The works this paper leans on most, across its whole bibliography — not restricted to papers in our corpus. Ranked by composite intensity, which combines how often a work is mentioned, how many sections mention it, and how much of that falls in the main text rather than the appendix.
| Reference | Intensity | Mentions | Sections | Main text | |
|---|---|---|---|---|---|
| 1 | Paul Gompers, Anna Kovner, and Josh Lerner (2009) Specialization and success: Evidence from venture capital | 1.000 | 6 | 3 | 100% |
| 2 | Yael V Hochberg, Alexander Ljungqvist, and Yang Lu (2007) Whom you know matters: Venture capital networks and investment performance | 0.874 | 10 | 2 | 100% |
| 3 | Sophie Manigart, Mike Wright, Andy Lockett, Miguel Meuleman, Hans La… (2002) Why do european venture capital companies syndicate? | 0.874 | 5 | 2 | 100% |
| 4 | Moreno Bonaventura, Valerio Ciotti, Pietro Panzarasa, Silvia Liveran… (2020) Predicting success in the worldwide start-up network | 0.737 | 3 | 2 | 100% |
| 5 | Brian Uzzi (1996) The sources and consequences of embeddedness for the economic performance of organizations: The network effect | 0.737 | 3 | 2 | 100% |
| 6 | Andrew David Cliff and J Keith Ord (1981) Spatial processes: models & applications | 0.644 | 2 | 2 | 100% |
| 7 | Ruiqi Li, Lingyun Lu, Tianyu Cui, Weiwei Gu, Shaodong Ma, Gang Xu, a… (2021) Assessing the attraction of cities on venture capital from a scaling law perspective self | 0.644 | 2 | 2 | 100% |
| 8 | Chenxin Liu, Yu Yang, Bingsheng Chen, Tianyu Cui, Fan Shang, Jingfan… (2022) Revealing spatio-temporal interacting patterns behind complex cities self | 0.644 | 2 | 2 | 100% |
| 9 | Raghuram Rajan, Henri Servaes, and Luigi Zingales (2000) The cost of diversity: The diversification discount and inefficient investment | 0.644 | 2 | 2 | 100% |
| 10 | Vincent D Blondel, Jean-Loup Guillaume, Renaud Lambiotte, and Etienn… (2008) Fast unfolding of communities in large networks | 0.511 | 2 | 1 | 100% |
Showing the top 10 of 49 scored citations.