Problems of China's venture capital and strategic research

Abstract: As China's high-tech industries, venture capital for promoting the commercialization of our research, high-tech industries, growth and Development of high-tech enterprises an important factor is the venture capital funds invest in high-risk bears high-tech projects to promote commercialization of high-tech achievements as soon as possible in order to achieve high capital gains of Investment behavior and it is high-tech industries in the process of a support system for effective use of funds, high-tech industrial Development is inseparable from risk Investment This paper mainly studies the current problems in China's venture Investment, and proposed the Development and improvement of China's venture Investment strategy.

Keywords: venture capital, venture investors, venture capital

0 Introduction
As China's Economic Development, especially high-tech industries, venture capital for promoting the commercialization of our research, high-tech industries, science and Technology an important factor in business growth and Development. Is essentially a high-tech venture capital and financial phase combined to put money into risky high-tech development and production, enabling the rapid scientific and technological achievements into new commodities Investment mechanism and it is high-tech industries in the process of a support system for effective use of funds, high-tech industries without risk Investment with the developed countries, China in venture capital is not doing enough in this regard, China's venture capital is still in its infancy, the lack of effective operation of high-tech industry, the high-tech industries are subject to certain large-scale development degree of inhibition, needs to improve many aspects of this paper mainly on China's current venture capital to analyze the problems and put forward some suggestions.

1 the meaning of Investment risk
Venture Capital (Venture capital, venture capital has been translated according to the U.S. definition of a comprehensive Venture Capital Association, venture capital is invested by professional financiers to the new, rapidly developing, there is great potential to compete with corporate interests in a capital, according to the definition of the European Venture Capital Association, venture capital is a specialized Investment company by the great development potential to the growth, expansion-type or recombinant type of non-listed companies to provide financial support and supported by management in the Investment behavior , United Nations Economic and Development 24 industrialized countries in 1983, held the second Investment seminar that all high-tech and knowledge-based, Technology-intensive production and management of investment in innovative products or services, can be as venture capital, China <<on the development of China's venture capital industry as soon as possible a proposal>> in that venture is a failure to hold the risk capital to invest in high-tech research and product development areas, to promote high-tech commercialization of the results as soon as possible in order to achieve high capital gains and investment behavior.

Simply put, venture capital is risk capital provided by venture investors, venture capital firms as investments in venture investment, management and operation of a financing process and methods. Venture capital is a high-tech industry booster, It is in the high tech industry to cut into the crucial moment, to fill the high-tech industrialization process, the research and development phase of the government funding or corporate (and individual self-production stage of industrialization and large gap between bank loans, high-Technology industry Thanks to all aspects of the financial commitment made possible, in promoting the development of high-tech industries play an important role in venture capital since its beginning, inextricably linked with the high-tech enterprises, the integration of the two stems from each other internal needs, in line with both the natural combination of essential features, it is this mutually beneficial integration between the two determines the role of relationship is not just a one-way, but a win-win relationship [1], so perfect and development of China's venture capital is very important.

2 present the problems of China's venture capital
China's venture capital industry is the only development in the reform and opening up of .1985 in September, the first franchise of a national financial institutions, venture capital - China New Technology Venture Investment Corporation (the record company was founded, the end of 2007, engaged in venture capital organizations have more than 400 in China's venture capital management total more than 120.585 billion yuan venture capital, risk investment, venture capital in 2007 amounted to 39.804 billion yuan more than the number of venture capital is also up to 741 items project, the average venture capital management, capital amounted to 849.2 million yuan. Clearly, the development of China's venture capital industry is relatively fast, its role in promoting the creation of high-tech companies and growth has played a positive role, but we also should be noted that China's venture capital industry has experienced only a short history of the development so far is still in the preliminary stages of development, the existing scale of risk capital is difficult to meet the needs of the market, can not independently support the development of high-tech enterprises, venture capital At the present stage, there are still a lot of problems, block its more rapid development in China. At present, China's venture capital problems are:
2.1 total venture capital, lack of qualified venture investors
Overall, the size of the existing venture capital is also difficult to meet the needs of the market now, our main source of venture capital funding, financial Technology and banking technology development loans, venture capital financing channels narrow. And our current development model as "government-led", public funding and bank loans as the main technology development venture capital small, and the government as the main funders, resulting in a single investment entities, affecting investment returns. Additionally, the risk of long investment cycle, high-risk Government funds are not suitable for the nature of the venture capital market [2] from established venture capital funding sources, except foreign investment funds, mostly financed by the government or financial institutions, private, private capital is almost No, narrow financing channel, the total risk of a serious shortage of investment capital.

2.2 out of lack of effective channels for venture capital
The vitality of venture capital is circulating capital, the core mechanism is a mechanism for withdrawal. No easy exit channels, venture capital will not be able to achieve capital appreciation and a virtuous cycle, can not attract venture capital to enter the field of venture capital Risk Capital "exit channel "or exit mechanisms are not yet resolved, there is no well-developed venture capital system, you can not venture capital and high-tech enterprises to build a channel [3]. venture capital exit channels are generally five kinds: business listing, mergers and acquisitions, stock repurchase the shares sold, liquidated losses in China's venture capital industry, the lack of channels for a reasonable return on investment, although China's GEM was October 30, 2009 grand opening, but for the operation of the GEM specification is still gradually improving in.

2.3 the risk of investment Laws and regulations lag is not perfect
In recent years, China's central and local governments have introduced a number of policy measures to support high-tech companies, including tax incentives, personnel benefits, credit offers, etc., but the risks of investing in high-tech companies and venture investors, investment management enterprise support policies rarely, the risks associated with investment in industry Law, such as <<Venture Capital Venture Capital Fund Law Act >>,<<>> and so has not been introduced [4] in market access, tax incentives, investment and financing management. the lack of venture capital to support the policies and regulations.

2.4 the development of venture capital intermediaries lag
Currently in China, required a special venture capital market intermediary service organizations such as industry associations, standards certification, rating agencies and other intellectual property rights is also the relative lack of investment intermediaries, the quality of personnel and inadequate credit system has become a huge development agency obstacles. Some intermediaries lack of professional restraint mechanism and code of ethics, there is money driven and provide a false assessment of the phenomenon, so that some of the agency's credibility can be greatly reduced utilization in this case, the risk capitalists tend to do a lot of things outside of their professional and reduce the risk of investment efficiency and, stagnant development agency, intermediary services are not standardized, resulting in both capital and information exchange project is not sufficient, this information is not the formation of a hidden symmetry of many errors, leading venture capital firms and strategic marketing decision-making errors, which seriously hinder the development of China's venture capital market. Links to free download http://www.hi138.com 2.5 extreme lack of venture capital professionals
Engaged in venture capital professionals, not only to master the relevant knowledge within the financial sector, and high-tech industries should also be familiar with related technologies, the only way to correct the risk assessment and investment operations, reduce investment risk of failure. At present, the risk of Most investors still remain in academic forums and theoretical research level, in actual practice, people really do not know how much venture capital, most investment professionals come from government, private enterprises, listed companies and other departments, are basically halfway decent Most lack of expertise and experience, the larger limitations.

3 Promote the development of China's venture investment strategy
In view of the process of making venture capital more than the existence of the problem, the following development strategies:
3.1 to broaden the sources of funding, the implementation of the diversification of investment risk
China should broaden the sources of funds, investment must be diversified. The government should gradually fade out the role of investors, and individuals to encourage more private capital to participate in the investment, to regulate the operation of the market [5] In addition to the risk of drawing on foreign investment in the development of industry experience in the control of financial risks under the premise that in the pension funds, insurance funds, housing funds and other institutional investors, private capital and some of these have good market performance of listed companies as strategic investors to the risk involved in investment, China will provide a good development of venture capital sources and channels of direct financing and promote the development of China's venture capital. the introduction of private capital to high-tech venture capital, capital and technology through a combination of the capital's largest value-added [6] as well as from international experience point of view, the involvement of foreign venture capital development is an important foundation of their venture. China should reduce the risk of investment restrictions on venture capital to develop sound policies, and improve their transparency, promotion of foreign venture capital concern, attracting foreign venture capital make it more supportive of the development of Chinese high-tech enterprises in China and also the development of venture capital funding sources to broaden an important channel.

3.2 The establishment of China's national conditions exit mechanism for venture capital
Because there is a periodic feature of venture capital, so the ability to effectively deliver capital gains, the funds will vote its shares from the form into a form that is realized on the funds become an important issue. In order to promote the smooth circulation of venture capital and incremental the entry of venture capital, we must consider the withdrawal of venture capital to establish an effective mechanism of China's venture investment may be the most realistic way out of corporate mergers and acquisitions, several other more realistic approach may be followed by the withdrawal of the GEM Exchange, venture and buy-back RTO [7] to run our country in the Growth Enterprise Market of the initial stage, the role of GEM is to provide SMEs with high growth financing chain of intermediate links, so both from China's capital market development, standardize and improve the reality GEM, but also actively develop and use the other exit channels for venture capital.

3.3 Optimization of venture capital investment environment, accelerate the formulation of Laws and regulations on venture capital
Establish a standard mechanism for venture capital operations of legal systems, the successful experience of developed countries shows, legislation and supervision is to promote the healthy development of risk investment protection. Venture capital is to provide venture capital for the venture, through the management of scientific and technological achievements in the "incubator" special investment into real productivity, which is different from any form of traditional investment venture capital market is a legal act, must have good Laws and regulations, therefore, strictly regulate the operation mechanism of risk investment, is to ensure that China's venture capital industry healthy development of the necessary measures. We need to adapt it as soon as possible to develop appropriate regulations and management practices, improve the protection of intellectual property legal system, such as <<Patent Law >>,<< technology contract law>> and so on, to the risk of the entrepreneur patent, exclusive rights, such as the right to a particular innovation and protection, to take tax incentives program to reduce the risk of capital acquisition costs, increase the average rate of return of investment risk level.

3.4 to speed up risk investment intermediaries and institutional development project assessment
Venture capital intermediaries is to use a variety of financial instruments and investors to raise the professional services organization, including accounting firms, law firms, investment advisers, credit rating agencies, technical information, consulting organizations, professional market research agencies, professional organizations . to establish a highly authoritative assessment of investment projects specialized agencies, the assessment by experienced investment experts on risk assessment by the line of professional services to guide investors effective investment. In addition, the need to improve the credit agency and intermediary the quality of agency personnel, and efforts to take measures to reduce the risk of investment in information costs and transaction costs, the venture capital market in order to improve the operational efficiency of the system for venture capital firms to provide standardized and effective intermediary services, venture capital companies to make the right strategic decision-making, and promote faster development of China's venture investment.

3.5 venture capital professionals to develop high-quality
In the process of formation and development of high-tech industry, the talent is the key factor, should accelerate the training of high-risk investment professionals, venture capital to speed up the existing employees in the training, you can also use international cooperation and exchange, to attract overseas talent. We should strive to cultivate a skilled, management, familiar with financial and finance team of venture capitalists, depends not only on its own unique qualities and expertise, but also to design an effective incentive and restraint mechanisms to prevent the moral hazard. to promote entrepreneurs and venture capitalists do their best to enterprises, to achieve value of human capital [8], to create "people-oriented" culture, can be taken to give venture capitalists wages, benefits, bonuses, stock, options and income commission system etc., to stimulate venture capital personnel of rapid development.

4 Conclusion
In short, because of its promotion of venture capital technology industry, a huge role in promoting Economic growth, with China's growing economy and closely integrated world economy, more and more venture capital play a significant contribution to the growth of China's Economic role in our should learn from the experience of the developed countries, to perfect the laws, regulations and institutional building, to adopt policies to encourage, to play a guiding role of the government to open up sources of venture capital, the introduction of venture capital professionals to provide the best exit channel for venture capital and to strengthen mechanisms and other measures, China's venture capital industry, actively promote the healthy development of venture capital to promote faster commercialization of our scientific research, technology industry and high-tech business growth and development.

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