Transformations  in
Business & Economics

INFLUENCES OF VENTURE CAPITAL ON ENTERPRISE FINANCING CONSTRAINTS AND SUSTAINABLE GROWTH ABILITIES FROM THE PERSPECTIVE OF LIFECYCLE¹
Lijuan Zhao, Dunli Zhang, Ting Zhu, Ting Zhang, Fengpei Wu

ABSTRACT. Venture capital exerts heterogeneous influences on the financing constraints and sustainable growth abilities of enterprises in different lifecycles, but existing studies have not clearly revealed its concrete consequences. To explore the influences of venture capital on enterprises in different lifecycles using the 2009-2018 data of China's A-share listed companies and multiple regression analysis model, the influences of venture capital on the financing constraints and sustainable growth abilities of enterprises in different lifecycles were dynamically analysed on the bases of their organisational characteristics. Results show that the financing constraints faced by growth-stage enterprises are greater than those by mature-stage enterprises, and venture capital can relieve growth-stage enterprises better than in mature-stage enterprises from the financing constraints. Venture capital exerts a significantly stronger effect on mature-stage enterprises than in growth-stage enterprises in terms of sustainable growth ability. In addition, the effect of venture capital on relieving the financing constraints is more significant among non-state-owned growth-stage enterprises, and its effect on enhancing the sustainable growth ability seems more prominent in state-owned mature-stage enterprises. Conclusions expand the research boundary regarding the influence consequences of venture capital and provide theoretical reference and decision-making basis for the dynamic selection of financing strategies in listed companies and their sustainable development.

KEYWORDS:  enterprise lifecycle, venture capital, financing constraint, sustainable growth ability.

JEL classification:  G24, G32, M10.

¹Acknowledgments: This study was supported by the General Fund Program of Social Sciences of Hubei Province (No. 2019090) and the Fundamental Research Funds for the Central Universities, South-Central University for Nationalities (No. CSQ20001).