Corporate venture capital: technological innovation or value creation? A comparative study of CVC- and IVC-invested Chinese listed companies

ABSTRACT

This paper analyzes the effects of corporate venture capital (CVC) and independent venture capital (IVC) backing on technological innovation and value creation in invested companies. Using data on Chinese listed companies, we show that CVC investment can induce higher firm value than can IVC investment. By considering different dimensions of complementary assets, technological fit, geographical proximity, and product market relations, we explore the mechanism through which CVC contributes to innovation and value creation in invested companies in China.

KEYWORDS:

• Corporate venture capital
• independent venture capital
• technological innovation
• firm value

JEL CLASSIFICATION:

• G23
• G24

Disclosure statement

No potential conflict of interest was reported by the authors.

ORCID

Jun Yang http://orcid.org/0000-0002-5796-7672

Notes

1 Due to the modest sample size, we employ one-to-one matching with replacement, and ties are allowed. As a robustness check, we also conduct one-to-four nearest neighbour matching, and find that the results do not change significantly.

Additional information

Funding

This study was partially supported by the grants from the Humanities and Social Sciences Foundation of Ministry of Education of China [grant number 17YJAZH080] and the Jiangsu Qing Lan Project and Six Talent Peaks Project (JY-049).