Assessing the Efficiency of Venture Capital Functioning in the Transforming Economy in UAE and China by a Mathematical Model

This article examines the evolution of approaches to the content of venture capital based on the evolution of venture capital and venture capital investment, post-industrial society, institutional theory, and experience of forming the venture capital market in developing economies. Hypotheses of the functioning of venture capital in the transforming economy of the UAE and China are proposed and tested. An economical and mathematical model for assessing the efficiency of venture capital functioning has been developed. It was found that there is a particular relationship between the national characteristics of the country’s venture capital industry and the capital invested in innovative industries, as well as the production efficiency of these industries. Moreover, the attractiveness of venture capital investments somehow increases with investments in other sectors in both countries. Since the Chinese market evolved earlier than UAE, it has the most remarkable characteristics, including higher capital workforce ratios and higher exports of science and technology-intensive products. In addition, the Chinese market has a high level of development and focuses on a sustainable financing cycle than UAE.

Commitment to capital raising for venture capital funds in India: An Application of ARDL Model

Venture capitalists (VCs) áourish on the ability to add funds to their kitty across nations. Consequently, VCsíability to convince Limited Partners (LP), who are their primary source of Önancing, plays a critical role in the venture capital investment growth in any economy. However, it is not easy to rake in capital from an investor. LPs assess the market conditions carefully before making their capital available to the VCs. This paper examines the macro-economic variables that ináuence the supply of money to venture capital funds in emerging economies such as India from an LPs perspective. The empirical analysis using Autoregressive-Distributed Lag (ARDL) approach reveals that supply of capital to the VC funds in India is ináuenced by macro variables as well as past investment behaviours. Macro-variables such as GDP growth, interest rate spread, global liquidity, and ináation rate signiÖcantly ináuence the supply of capital to the VC funds in India. However, stock market liquidity does not ináuence the supply side of the venture capital investment. Our analysis reveals that VCsífund raising in India is highly ináuenced by their past investment relation with the LPs.

THE MANAGEMENT OF VENTURE CAPITAL AS A TYPE OF FINANCIAL RESOURCES: GOALS & OBJECTIVES

In the context of Ukraine’s integration into the world market, there is a growing interest in creating a control system for all stages of venture capital activities. The mechanism of effective management of venture activities of an enterprise should become a tool for establishing this system. The system of information flows is of great importance, which provides information to the process of making management decisions on a risky innovative project at a venture capital enterprise. The purpose of the venture business is to make a profit on the invested funds [1]. Unlike simple investment, venture capital is the most risky form of capital investment. However, if the project is successful, venture capital investment is the most profitable. Venture investment is, on the one hand, a way of financing the innovative vector of the economy, on the other, an innovative form of entrepreneurship. The main goal of venture capital financing is that the monetary capital of some entrepreneurs and the intellectual capabilities of others (original ideas or technologies) are combined in the real sector of the economy in order to bring profit to both types of entrepreneurship in a new company.

Technology Entrepreneurship

This chapter examines the growth of technology entrepreneurship in China. Compared to other professions such as public service or academia, entrepreneurship was not regarded highly in Chinese culture and was banned in the Mao era as ‘walking on the road of capitalism’. It has now become a key element of China’s innovation machine, and being an entrepreneur is an attractive career. The reforms in China’s capital market, including venture capital investment, together with policy support under the banner of mass entrepreneurship and innovation, such as access to science and research, incubators and accelerators, and entrepreneurship education, are described. The case of the emerging biotechnology/biopharmaceutical industry is used to illustrate the importance of combining technology, talent, capital, and policy in technology entrepreneurship. Selected large and rapidly growing unicorns are profiled, illustrating how entrepreneurial firms aiming to develop future technologies emerge and grow.

The Internal Connection Analysis of Information Sharing and Investment Performance in the Venture Capital Network Community

In order to explore the internal connection between information sharing and investment performance in the venture capital network community, this study took environmental-governance start-ups as the research object and used the 2009–2020 environmental-social enterprise start-up venture capital investment events as a data sample. The successful exit rate of the venture capital portfolio and the successful listing rate of investment ventures were used as the measurement criteria. Combined with regression analysis, the relationship between information sharing and investment performance in the venture capital network community was analyzed in detail. Research shows that there are differences between the ways of information sharing in the venture capital network communities. In the regression results, all coefficients are less than 0.01. There is a positive correlation between information sharing and investment performance in the venture capital network community. With the increase in enterprise characteristic variables, the degree of enterprise risk information sharing is getting higher and higher. This ultimately leads to more and more frequent corporate investment performance and a higher possibility of acquisition. Among them, the degree of information sharing in the venture capital network community is relatively high, and venture capital companies that are supported by corporate venture capital institutions will benefit even more from listed capital. Not only was the analysis of the relationship between finance and investment in the venture capital network community pointed out in this research, but also the investment development of entrepreneurial enterprises was also provided with feasible suggestions.

Entrepreneurial Passion and Venture Capitalists’ Willingness to Invest: The Role of Relational Capital

Venture capital investment has serious conflicts of interest and information asymmetry. Venture capitalists often make investment decisions on the basis of the passion of entrepreneurs, including enthusiasm and preparedness, in the process of interacting with them. Most of the previous research on relational capital have focused on the cooperative relationship between suppliers and buyers. However, the role of relational capital in the process of partnership between venture capitalists and entrepreneurs has not been revealed. On the basis of signaling theory, we explore the relationship between entrepreneurial passion and venture capitalists’ willingness to invest. We also examine the mediating and moderating roles of relational capital. This study takes 79 projects between venture capitalists and entrepreneurs as samples for empirical analysis to verify our hypothesis. Results show that entrepreneurs’ enthusiasm and preparedness have a significant positive impact on venture capitalists’ willingness to invest. Relational capital plays a mediating role between entrepreneurial passion and venture capitalists’ willingness to invest. Relational capital positively moderates the relationship between preparedness and venture capitalists’ willingness to invest but has no moderating effect between enthusiasm and venture capitalists’ willingness to invest. Results deepen the understanding of the relationship between entrepreneurs’ passion and venture capitalists’ willingness to invest, which has guiding significance for venture capital practice in China.

Russian analogue of the legal structure of a convertible loan

The research purpose is to give a civil-legal description and assess the prospects for the practical application of an element of the venture financing legal infrastructure that is new for Russian realities. The research methods are presented by special technical and legal tools, and by logical means of analysis and synthesis, induction and deduction, comparison and generalization, analogy and legal modeling, characteristic of civilist doctrinal research. The research results include the established civil nature of the Russian structure of a convertible loan, the identified principal conditions and the key stages of the conversion mechanism, the research also confirmed its convenience and efficiency. The research significance is manifested in its ability to strengthen the doctrinal basis of the legally permitted multivariate economic activity, promote accelerating the integration of convertible loans into the Russian legal field, help intensify domestic venture capital investment and increase the attractiveness of Russian jurisdiction for foreign investors.