Government venture capital funds: Balancing the impact of social and financial goals on startups

Jiu Jin Li; Hung Gay Fung; Shi An

doi:10.1016/j.chieco.2024.102185

Government venture capital funds: Balancing the impact of social and financial goals on startups

Jiu Jin Li^*
, Hung Gay Fung
, Shi An

^*Corresponding author for this work

Daqing Petroleum Institute
Chinese Academy of Fiscal Sciences
University of Missouri at St. Louis
School of Management, Harbin Institute of Technology

Research output: Contribution to journal › Article › peer-review

12 Scopus citations

Abstract

This study evaluates the policy objectives and efficacy of government venture capital funds (GVCs) on the performance of invested entrepreneurial ventures. Analyzing data from China on GVCs, private venture capital funds (PVCs), and foreign venture capital funds (FVCs), it reveals that GVC-supported firms surpass those backed solely by domestic PVCs in R&D investment, return on assets (ROA), Tobin's Q, and corporate social responsibility metrics. Acting as government stewards, GVCs effectively fulfill policy goals. Moreover, GVC-backed ventures attract more venture capital following their lead and achieve higher one-day returns at IPOs compared to firms backed solely by private VC funds.

Original language	English
Article number	102185
Journal	China Economic Review
Volume	85
DOIs	https://doi.org/10.1016/j.chieco.2024.102185
State	Published - Jun 2024
Externally published	Yes

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

SDG 9 Industry, Innovation, and Infrastructure
SDG 12 Responsible Consumption and Production

Keywords

Corporate social responsibility
Government venture capital funds
R&ds
ROA
Social goals

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10.1016/j.chieco.2024.102185

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title = "Government venture capital funds: Balancing the impact of social and financial goals on startups",

abstract = "This study evaluates the policy objectives and efficacy of government venture capital funds (GVCs) on the performance of invested entrepreneurial ventures. Analyzing data from China on GVCs, private venture capital funds (PVCs), and foreign venture capital funds (FVCs), it reveals that GVC-supported firms surpass those backed solely by domestic PVCs in R\&D investment, return on assets (ROA), Tobin's Q, and corporate social responsibility metrics. Acting as government stewards, GVCs effectively fulfill policy goals. Moreover, GVC-backed ventures attract more venture capital following their lead and achieve higher one-day returns at IPOs compared to firms backed solely by private VC funds.",

keywords = "Corporate social responsibility, Government venture capital funds, R\&ds, ROA, Social goals",

author = "Li, \{Jiu Jin\} and Fung, \{Hung Gay\} and Shi An",

note = "Publisher Copyright: {\textcopyright} 2024",

year = "2024",

month = jun,

doi = "10.1016/j.chieco.2024.102185",

language = "英语",

volume = "85",

journal = "China Economic Review",

issn = "1043-951X",

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T2 - Balancing the impact of social and financial goals on startups

AU - Li, Jiu Jin

AU - Fung, Hung Gay

AU - An, Shi

PY - 2024/6

Y1 - 2024/6

N2 - This study evaluates the policy objectives and efficacy of government venture capital funds (GVCs) on the performance of invested entrepreneurial ventures. Analyzing data from China on GVCs, private venture capital funds (PVCs), and foreign venture capital funds (FVCs), it reveals that GVC-supported firms surpass those backed solely by domestic PVCs in R&D investment, return on assets (ROA), Tobin's Q, and corporate social responsibility metrics. Acting as government stewards, GVCs effectively fulfill policy goals. Moreover, GVC-backed ventures attract more venture capital following their lead and achieve higher one-day returns at IPOs compared to firms backed solely by private VC funds.

AB - This study evaluates the policy objectives and efficacy of government venture capital funds (GVCs) on the performance of invested entrepreneurial ventures. Analyzing data from China on GVCs, private venture capital funds (PVCs), and foreign venture capital funds (FVCs), it reveals that GVC-supported firms surpass those backed solely by domestic PVCs in R&D investment, return on assets (ROA), Tobin's Q, and corporate social responsibility metrics. Acting as government stewards, GVCs effectively fulfill policy goals. Moreover, GVC-backed ventures attract more venture capital following their lead and achieve higher one-day returns at IPOs compared to firms backed solely by private VC funds.

KW - Corporate social responsibility

KW - Government venture capital funds

KW - R&ds

KW - ROA

KW - Social goals

UR - https://www.scopus.com/pages/publications/85192070250

U2 - 10.1016/j.chieco.2024.102185

DO - 10.1016/j.chieco.2024.102185

M3 - 文章

AN - SCOPUS:85192070250

SN - 1043-951X

VL - 85

JO - China Economic Review

JF - China Economic Review

M1 - 102185

ER -

Government venture capital funds: Balancing the impact of social and financial goals on startups

Abstract

UN SDGs

Keywords

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