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Intellectual Capital and Firm Performance in the Context of Venture-Capital Syndication Background in China

Author

Listed:
  • Yuzhong Lu
  • Zengrui Tian
  • Guillermo Andres Buitrago
  • Shuiwen Gao
  • Yuanjun Zhao
  • Shuai Zhang
  • Thiago Christiano Silva

Abstract

This paper is intended to investigate the role of Venture-Capital Syndication (VCS) background in the relationship between intellectual capital (IC) and portfolio firm performance (PFP); specifically, this article examines the moderating effect of VCS’s leading firm background and member heterogeneity on the effect of IC on PFP. This study used a modified VAIC model to measure IC to compose a 4-component variable including human capital, structural capital, relational capital, and innovation capital. The data were collected from VCS-backed and listed firms in China during 2014 to 2018 applying the pooled OLS model for hypotheses test, Generalized Method of Moments (GMMs) to reduce endogeneity and unobserved factor control, and also return on equity (ROE) instead of ROA for the robustness test. Empirical results showed that IC and its components can improve PFP for VCS-backed firms in China; in detail, IC showed greater impact on performance of firms invested by foreign lead investors than in private or government VCS, specially reflected in the impact of innovation capital on PFP. Furthermore, IC showed weaker impact on PFP of mixed VCS-backed firms compared to pure VCS-backed firms and showed diminished effect on higher VCS member heterogeneity mainly reflected in the impact of relational capital on firm performance. These findings propose a new way of combining IC and VC to improve firm performance and are beneficial to theoretical development of IC and VC as well as a perspective for VC firm managers to choose suitable partners prior to join a VCS.

Suggested Citation

  • Yuzhong Lu & Zengrui Tian & Guillermo Andres Buitrago & Shuiwen Gao & Yuanjun Zhao & Shuai Zhang & Thiago Christiano Silva, 2021. "Intellectual Capital and Firm Performance in the Context of Venture-Capital Syndication Background in China," Complexity, Hindawi, vol. 2021, pages 1-17, March.
    • Handle: RePEc:hin:complx:3425725
    DOI: 10.1155/2021/3425725
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    Cited by:

    1. Guo, Yunxia & Yu, Mengyao & Xu, Mingchen & Tang, Ying & Huang, Jingran & Liu, Jia & Hao, Yu, 2023. "Productivity gains from green finance: A holistic and regional examination from China," Energy Economics, Elsevier, vol. 127(PA).
    2. Lujing Liu & Jiyue Zhang & Jian Xu & Yiqun Wang, 2022. "Intellectual Capital and Financial Performance of Chinese Manufacturing SMEs: An Analysis from the Perspective of Different Industry Types," Sustainability, MDPI, vol. 14(17), pages 1-17, August.
    3. Sigit Hermawan & Nisfatur Rokhmania & Ruci Arizanda Rahayu & Iffah Qonitah & Ratna Nugraheni, 2021. "Financial performance mediates the relationship of intellectual capital to firm value in Indonesian banking companies," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 10(6), pages 181-188, September.
    4. Leogrande, Angelo & Costantiello, Alberto & Laureti, Lucio, 2021. "The Impact of Venture Capital Expenditures on Innovation in Europe," MPRA Paper 109897, University Library of Munich, Germany.
    5. Ummu Salma Al-Azizah & Bagus Pamungkas Wibowo, 2023. "Impact of Intellectual Capital on Financial Performance: Panel Evidence from Banking Industry in Indonesia," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 5, pages 51-65.
    6. Muhammad Ahmad & Rohani Mohd Rus, 2021. "Intellectual Capital and Firm Performance across Pakistani Industries," Business and Economic Research, Macrothink Institute, vol. 11(4), pages 56-77, December.

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