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Cohesiveness or competitiveness: Venture capital syndication networks and firms' performance in China

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  • Yang, Song
  • Li, Yuanqin
  • Wang, Xingzhou

Abstract

We use a time-sequence dataset of 837 Venture Capital Firms in China to investigate how the social network characteristics of these VC firms affect their performance. We identified three network positional features: degree centrality, Eigen-value centrality, and efficiency that hypothetically are consequential to a VC firm's performance. Our data analysis reveals that network efficiency is a significant but negative determinant of a VC firm's performance – the network inefficiency, measured by the extent to which the alter firms of an ego firm are connected with each other boosts the ego firm's performance. We discuss such findings by contextualizing them in the unique institutional environment and emerging market of China.

Suggested Citation

  • Yang, Song & Li, Yuanqin & Wang, Xingzhou, 2018. "Cohesiveness or competitiveness: Venture capital syndication networks and firms' performance in China," Journal of Business Research, Elsevier, vol. 91(C), pages 295-303.
    • Handle: RePEc:eee:jbrese:v:91:y:2018:i:c:p:295-303
    DOI: 10.1016/j.jbusres.2018.07.006
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    References listed on IDEAS

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    Cited by:

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    5. TIAN, Xiaoli & KOU, Gang & ZHANG, Weike, 2020. "Geographic distance, venture capital and technological performance: Evidence from Chinese enterprises," Technological Forecasting and Social Change, Elsevier, vol. 158(C).
    6. Nikiforou, Argyro Iro & Lioukas, Spyros & Voudouris, Irini, 2020. "Network structure and firm-level entrepreneurial behavior: The role of market and technological knowledge networks," Journal of Business Research, Elsevier, vol. 106(C), pages 129-138.
    7. Chen Zhang & Xinghua Dang & Tao Peng & Chaokai Xue, 2019. "Dynamic Evolution of Venture Capital Network in Clean Energy Industries Based on STERGM," Sustainability, MDPI, vol. 11(22), pages 1-25, November.
    8. Ruling Zhang & Killian J. McCarthy & Xiao Wang, 2022. "Two's company, three's a crowd: The impact of corporate venture capital unit's investment partners on the corporate investor's innovation performance," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(4), pages 975-987, June.
    9. Cailou, Jiang & DeHai, Liu, 2022. "Does venture capital stimulate the innovation of China's new energy enterprises?," Energy, Elsevier, vol. 244(PA).

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