From banks or venture capitals? The financing choices of Chinese high-tech enterprises during the start-up period

Fang, Yongmei, Guan, Bo ORCID: https://orcid.org/0000-0001-9764-5646 and Yang, Guiying 2024. From banks or venture capitals? The financing choices of Chinese high-tech enterprises during the start-up period. SAGE Open 14 , 3. 10.1177/21582440241266021

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Abstract

The purpose of this research is financing options for high-tech enterprises in China during their early-stage. This study develops a three-phase model to analyze the financing choices of Chinese high-tech firms between banking and venture capital while considering information asymmetry. The findings reveal that opaque information disclosure favors venture capital financing, while transparent disclosure leads to bank loans for equally qualified high-tech enterprises. Data analysis further confirms that both bank loans and venture capital are viable options for early-stage Chinese high-tech enterprises. These findings offer valuable guidance for high-tech firms and investors navigating China's financial landscape. Moreover, policy management departments can leverage these insights to make informed decisions and facilitate the financing of high-tech enterprises.

Item Type:	Article
Date Type:	Publication
Status:	Published
Schools:	Business (Including Economics)
Subjects:	H Social Sciences > HB Economic Theory
Publisher:	SAGE Publications
ISSN:	2158-2440
Date of First Compliant Deposit:	2 July 2024
Date of Acceptance:	21 June 2024
Last Modified:	20 Aug 2024 14:38
URI:	https://orca.cardiff.ac.uk/id/eprint/170233

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