• Asia-Pacific Journal of Business Venturing and Entrepreneurship
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• v.17 no.1
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• pp.1-12
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• 2022

This paper examines the influence of the portion of lead investors and investors' status on the investment performance of venture syndication. According to existing literature, multiple investors in VC syndicates can positively impact investment performance by investing both tangible and intangible resources in target companies based on market influence or high visibility. On the other hand, the presence of multiple leaders can cause conflicts in formulating and implementing investment strategy or free-riding problems or increase entry barriers for potential investors, lowering additional investment from existing investors. Therefore, we hypothesize that the relationship between proportion of lead investors and investment performance is inverted-U shape. Moreover, we predict that the status of VCs in the syndication will moderate the relationship between proportion of lead investors and investment performance since high-status actors are less likely to cooperate with or yield power to others. We tested these hypotheses using 24,677 VC syndicated investment data from 1991 to 2005 and found solid supports for the hypotheses. The findings suggest that firms need to consider relationship-based power dynamics among investors within a syndication and design effective role setting and coordination systems.

• Asia-Pacific Journal of Business Venturing and Entrepreneurship
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• v.13 no.6
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• pp.39-48
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• 2018

Despite the fact that Daejeon has excellent technology infrastructures such as government-funded research institutes, Daedeok Innopolis, and KAIST, the infrastructure for initial investment and growth support for technological start-ups is not sufficient. In particular, the amount of venture capital supply in Daejeon is relatively low compared to other innovation infrastructures. The purpose of this study is to suggest the implications of the venture capital ecosystem in Daejeon area through the analysis of what evolution process has been undergoing and what improvements and complementary points are needed in the future. First, the role of public finance system should be strengthened in order to stimulate angel investment and private capital inflows to start-up companies. Second, in order to cultivate investment professionals in the region, it is necessary to grant local funds to local institutions, and to run investment expert training courses in universities. Third, cooperation between related agencies is needed to add accelerator functions to existing incubators and to foster new accelerators. Fourth, in order to expand the role of local governments, it is necessary to establish funds, to open innovation mindset of public officials, and to communicate effectively with the central government. Fifth, basic venture ecosystem infrastructures such as inflow of excellent manpower, prevention of technology deception, improvement of rechallenge environment should be expanded. Sixth, it is necessary to reorganize the step-by-step start-up financing policy of 'Establishment - Growth - Exit - Rechallenge'. This study is meaningful in that it has grasped the current status of venture start-up financial ecosystem in Daejeon, which is changing rapidly. In particular, it is different in that it identifies financial difficulties venture companies in Daejeon and finds ways to utilize existing financial ecosystem efficiently.

• Korean Business Review
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• v.19 no.1
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• pp.157-174
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• 2006

In the past, because Korean private venture capital firms could get government support and subsidies, they could be survived in the market without having required management capabilities, advanced venture investment techniques, and professional supporting agencies and institutions. However, business environments have changed a lot recently. Now, only through identifying the optimal financial structures(the ratio of debt to equity), Korean private venture capital firms can minimize investment risks and ensure higher profits. Since Modigliani and Miller(1958) criticized the existence of the optimal financial structure, there have been numerous studies on the optimal financial structure of firms. However, there is no empirical study investigating the financial structure of venture capital firms. The purpose of this article is to analyze the relationship between firm characteristics, financial security indies, and financial profit indices of korean private venture capital firms. We gathered the data from various sources, including the web pages and the financial statements for 2003 and 2004. By using the student's t-test and the correlation analysis, we showed that there are differences in the current ratio and the ratio of net profit to net sales between new and old korean private venture capital firms. Even though it is known that korean private venture capital firms does not have enough knowledge and investment technique to compete with global venture capital firms, our result show that old korean private venture capital firms have already built some knowledge and understanding of venture capital investing.

• Journal of Digital Convergence
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• v.11 no.5
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• pp.73-81
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• 2013

The paradigm of IT ecosystem has been rapidly changing into open ecosystem irrespective of the territory on which the device, software and contents are located. IT venture ecosystem which can compete and collaborate with the global companies is really needed because the global opportunity of IT venture company has been expanding. Research model based on PEST-SWOT-AHP(Analytic Hierarchy Process) model was employed to analyze the current status and problems of IT venture ecosystem in Korea. Survey was conducted with 20 experts who are involved in venture companies, university, R&D research institute, and investment companies as a working group supported by the Ministry of Knowledge Economy (MKE). The empirical result showed that global promotion of IT ventures, coexistence and development of large enterprises and ventures, revitalization of investment infrastructure, and building of smart venture ecosystem are derived to revitalize IT venture ecosystem and suggested global revitalization model for smart IT venture ecosystem.

• Management & Information Systems Review
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• v.32 no.2
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• pp.21-46
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• 2013

The purpose of this paper is to find impacts of financial activities-financing and investment of Venture Firms during pre-listing periods on the firms' Venture Firm's listing(delisting). The several ratios financial variables relevant to the financing and investment were examined whether there are difference or not between two venture firms groups. The results of study can be summarized as follows. First, the firms of successful group have fewer numbers of equity financing and higher times of premium in issuing stocks than those of failed firms but there is no significant difference in the required time from startup to listing the KOSDAQ. Second, there is no significant difference in the ratio of capital increase in IPO between two groups but additional survey reveals that the successful firms financed equity in IPO by higher numbers of premium than failed firms, which can makes the major shareholder of the successful firms maintain high rayios share of stock. Third, the ratio of working capital investment of the successful firms is significantly higher than that of failed firms, on the other hand the failed firms' ratios of equipment and repayment investment are higher than those of successful firms. Finally, the ratio of R&D investment has no difference between two groups, this result is against the expectation, which is to be further analyzed.

• International Commerce and Information Review
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• v.11 no.3
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• pp.125-144
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• 2009

The purpose of this study is to research the investment environment of Vietnam and analyze the actual investment state of Korean enterprises in Vietnam and seek for the points at issue. In general, the investment environment in Vietnam shows both a positive side and negative side. However Vietnamese market is a attractive one as ever for direct investment of Korean enterprises considering their constant economy growth, investment increase of foreign company for Vietnam, China risk. And the point at issue in investment of Korean Enterprises is as follows. That is, inclining to manufacturing, preference of independence investment, small-sized investment by small and medium enterprises, preference of greenfield investment, restricted purpose of investment, insufficiency of infrastructure for logistics, electric power, legal system. The results of the study indicate mainly that the investment of Korean enterprise into Vietnam needs a switchover of the third service trade-tertiary industry, collaboration with Vietnamese enterprise through joint venture investment, a large-scale investment for Vietnam domestic market and neighboring countries' market, practical use of M&A with existing Vietnamese enterprise and diverse purpose for investment.

• The Journal of the Korea Contents Association
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• v.18 no.9
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• pp.584-593
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• 2018

The startup, which is a common noun to start a small business, has been recently one of main targets for policymakers due to its important role for job creation and considerable potential for sustainability of an economy. However, technological entrepreneurship decreased by 5.0% p from 2013 to 2016. The revitalization of entrepreneurial investment promoted by the government is mainly supported in fruitable venture companies at grow stage or 2~3 years before IPO through venture capital firms and angel funds. It is far from an investment at start-up. It is therefore necessary to motivate private investment to be active in the private start-up sector. In addition, the start-up investment requires institutional support and government support to meet the expectations of investors about the possibility of payback and profitability of private investment invested in the founding period. As a small entrepreneur at a comparably early stage in the lifecycle of business, investments for the startup are generally made by informal investors such as family, friends and fools, and their decision making processes are relatively non-programmed compared with ones for listed corporales such as venture capital and angel fund agency. This study focuses on analyzing decision making factors in investment, and verifying an impact of such factors, specifically the possibility of investment payback and investment profitability, in a decision-making process for the startup especially at the very early stage.

• Korea Trade Review
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• v.46 no.2
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• pp.177-191
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• 2021

Based on the existing OFDI (outward foreign direct investment) literature, this study endeavored to verify how the corruption of host countries affects the partner strategy of EMNEs (emerging multinational enterprises) when EMNEs enter global markets through joint ventures. Following the existing literature, this study classified corruption and partner strategies into two categories, respectively. First, the corruption of host country was divided into grand corruption and petty corruption. Second, EMNEs' joint venture partner strategy was divided into home country partner joint venture and host country (i.e., local) partner joint venture. Our hypothesis suggested that the greater the host country's grand corruption, the more EMNEs would choose the host country partner, while the strong petty corruption leads to the preference of home country partner in host country. The hypotheses were verified with a sample of 890 foreign direct investment cases of Chinese multinational companies from 2005 to 2015. As a result of the study, regardless of the degree of corruption, it was found that they prefer joint ventures with home country partners when EMNEs enter the global market through joint ventures.

• International Commerce and Information Review
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• v.10 no.1
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• pp.375-393
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• 2008

The purpose of this study is to investigate the Chinese investment environment and analyze the actual investment condition of Korean enterprises in China and examine the points at issue. In general, the investment environment in China shows satisfactory progress. China has a multiple and regional extension policy in investment. And the environment for investment changes to insufficiency of company profit, extension of service market, maintenance of legislative system, and insufficiency of preference about foreign company. There are situations of inclining to manufacturing, inclining of region, preference of independence investment, small-sized investment by small and medium enterprises, difficulty of financial assistance, excess of logistic cost, delay of logistic term, difficulty of settlement of legal dispute and difficulty of taking a relative information in investment of Korean enterprise in China. The results of the study indicate mostly that the investment of Korean enterprise into China needs turnover of service trade-tertiary industry, portfolio of investment territory, cooperation with Chinese enterprise through joint venture investment and a large-scale investment for extension of Chinese domestic market.

• Asia-Pacific Journal of Business Venturing and Entrepreneurship
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• v.18 no.5
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• pp.63-75
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• 2023

This study conducted empirical analysis on the factors affecting the investment performance of 205 domestic venture funds (with a total liquidation amount of 7.25 trillion KRW) newly formed from 2007 to 2017 and completely liquidated as of the end of 2022. Due to the nature of private equity funds, obtaining empirical data is extremely challenging, especially for data post-COVID-19 era liquidations. Nevertheless, despite these challenges, it is meaningful to analyze the impact on the investment returns of domestic venture funds using the most recent data available from the past 10 years. This study categorized the factors influencing venture fund performance into external environmental factors and internal factors. External environmental factors included "economic cycles," "stock markets," "venture markets," and "exit markets," while internal factors included the fund management company's capabilities in terms of "experience," "professional personnel," and "assets under management (AUM)." The fund structure was also categorized into "fund size" and "fund length" for comparative analysis. In summary, the analysis yielded the following results: First, the 3-year government bond yield, which represents economic cycles well, was found to have a significant impact on fund performance. Second, the average 3-month KOSDAQ index return after fund formation had a statistically significant positive effect on fund performance. Third, the number of IPOs, indicating the competition intensity at the time of venture fund liquidation, was shown to have a negative effect on fund performance. Fourth, it was observed that the larger the AUM of the fund management company, the better the fund's returns. Finally, venture fund returns showed variations depending on the year of formation (Vintage). Therefore, when individuals consider investing in venture funds, it is considered a highly effective investment strategy to construct an investment portfolio taking into account not only external environmental factors and internal fund factors but also the vintage year.