Venture capital investment culture differences between China and the West

摘要

This paper reviews the peculiarities of the venture capital in China and compares them with the West. Different definitions on innovation has been found, which are believed to support different funding behaviours between China and the West venture capital companies. In the process of due diligence, the Chinese will always use a third party to evaluate or re-exam the business plan provided by the company. Then, the west venture capitalist are inclined to invest early stage, while many venture capitalist in China are just invested firms which are just before Initial Public Offering. In addition, state-owned venture capital should not just purse the profit maximization; their main function should be spurring the nation's innovation and the technological development.