P2P借贷平台外文文献翻译众筹最新.docx

P2P借贷平台外文文献翻译众筹最新.docx

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P2P借贷平台外文文献翻译众筹最新

P2P借贷平台外文文献翻译众筹2020年最新

英文

Venturecapitalcertificationandcustomerresponse:

EvidencefromP2Plendingplatforms

EmmaLi

Abstract

ThispaperexamineswhetherthecertificationeffectofVCsextendstofirm'spotentialcustomers,andwhether,bycertifyingfirms'valuestopotentialcustomers,VCsprovidevaluetofirms.UsingweeklytradingdatafromP2PlendingplatformsinChina,wefindthattheamountofloansfacilitatedandthenumberoflendersincreasesignificantlyby25.7%and49.3%,respectively,immediatelyafterannouncementsthatP2PlendingplatformsobtainVCinvestment.WefindthatthiscertificationeffectincreaseswithmeasuresofVCreputationandmeasuresofinformationasymmetrybetweenP2Plendingplatformsandpotentialcustomers.Adifference-in-differencesanalysisprovidesconsistentresults,whicharerobustaftercontrollingfortheeffectsofnews,advertising,andfunding.WealsodocumentthatVC-backedplatformsarelesslikelytodefaultthannon-VC-backedplatforms.ThisresultprovidesindirectevidencethatVCbackinghaslong-termbenefitsbeyondthenewsandadvertisingeffects.

Keywords:

Venturecapitalcertification,P2Plendingplatform,Informationasymmetry

Introduction

TheroleofVCfinancinginvaluecreationforentrepreneurialfirmshasbeenwidelydiscussedinbothacademicandpractitionerliterature.Researchersarguethat,inadditiontoprovidingfinancing,VCscanofferotherservicesthatconsiderablyenhanceprivatefirms'likelihoodofsuccessthroughscreeningandmonitoring（see,e.g., Chemmanuretal.,2010, 2014; Casamatta,2003; Hellmann,1998）.VCsarealsoconsideredtoreducetheinformationasymmetrybetweenentrepreneursandpublicinvestorsincapitalmarketsbycertifyingthevalueofsecuritiesissuedbyrelativelyunknownstartups（MegginsonandWeiss,1991）.Industrypractitionersarguethat,inadditiontofundingprivatefirmsandreducinginformationasymmetryincapitalmarkets,VCscontributetothesuccessoffirmsinmanyotherways.Forexample,aVC'sreputationandnetworkcanfacilitatefirms'accesstopotentialcustomersintheproductmarket.

WeexaminewhetherthecertificationeffectofVCsextendstofirm'spotentialcustomers,andwhether,bycertifyingfirms'qualitytopotentialcustomers,VCsprovide“extra-financing”valuetofirms.TheempiricalquestionofwhetherVCsprovidecertificationtocustomershasnotyetbeeninvestigatedintheliterature,perhapsbecausethereisalackofdataonprivatefirmcustomers.

Weconductanovelsamplestudywithseveralexistingandhand-collecteddatabasestoexaminetheroleofVCsinmitigatingtheinformationasymmetrybetweenstart-upsandtheirpotentialcustomers.Weuseauniqueproprietarycustomerleveldatabase,whichincludesstartupcompanieswithsimilarbusinessmodelsandproductsintheP2PlendingindustryinChina.1 Foreachstartupcompany,wecollectweeklydataassociatedwiththecompany'scustomers（bothlendersandborrowers）,suchastheamountofloansfacilitated,numberoflenders,andnumberofborrowers.

ThecontextanddataappliedinthisstudyhavetwokeyadvantagesthatprovideuswitharareopportunitytostudywhetherVCsprovideacertificationeffecttopotentialcustomersofrelativelyunknowncompaniesinamarketcharacterizedbyhighinformationasymmetrybetweencorporateinsidersandtheircustomers.Thefirstkeyadvantageisthatourhigh-frequencydataallowustomeasureimmediatecustomerresponsestoVCinvestmentannouncements.Thisovercomessomeofthedifficultiesassociatedwiththeuseoflow-frequencysurveydata,whichisthetypicalpracticeamongresearcherswhenmeasuringindividualeconomicactivities（Gelmanetal.,2014）.Specifically,ourdataconsistofbothpre-VCinvestmentandpost-VCinvestmentcustomerresponsesinarealeconomy,whicharedifficulttoobtain.Thesecondkeyadvantageisthattheproductsfromeachstartupcompanyinoursetting,P2Ploans,arerelativelyhomogenousfromtheperspectiveofthecustomer（P2Plender）.MostChineseP2Plendingplatformshavesimilarbusinessmodelsandlendingprocedures.Inoursampleperiod,almostallplatformsprovideaprincipalguarantee2 thatprotectslenders'principalonceborrowersdefault.Therefore,fromtheperspectiveofP2Plenders,P2PloansondifferentP2Plendingplatformsarerelativelysimilarfixedincomeinvestmentswiththeprimarydifferencebeingtheinterestrates,maturities,anddefaultriskassociatedwiththeplatforms. Thisadvantagemitigatesthepotentialbiasescausedbytheheterogeneousfeaturesofproductsinotherstartupcompanies.

WeanswerthreequestionsconcerningtheroleplayedbyVCsincertifyingthevalueofthestartupplatformsinwhichtheyinvest.First,doVCsprovideacertificationeffecttopotentialcustomersandattractmoreofthem（e.g.,P2Plenders）immediatelyafterVCinvestmentannouncements?

Second,arethestart-upsthatreceiveinvestmentfromhighlyreputableVCsmorelikelytoattractcustomerscomparedtothosewhoreceiveinvestmentfromVCswithpoorreputations?

Third,isthemagnitudeofthecertificationeffectassociatedwiththedegreeofinformationasymmetrybetweenplatformsandtheircustomers?

Theresultsofourempiricalanalysiscanbesummarizedasfollows.Wefirstfindthattheproxiesforcustomerresponseoftheamountofloansfacilitatedandnumberoflendersincreasesignificantlyby25.7%and49.3%,respectively,aftertheannouncementofthefirstroundVCinvestmentinthosestartupplatforms,whilethenumberofborrowersdoesnotchangemuch.ThisresultisconsistentwiththeexistenceoftheVCcertificationeffectforpotentialcustomers.Inourexaminationofthedifferencesbetweenhigh-reputationandlow-reputationVCs,wefindthattheVCcertificationeffectforcustomersispositivelyassociatedwiththeVC'sreputation.4 Intheend,weshowthattheVCcertificationeffectforpotentialcustomersdecreaseswithplatformage,aproxythatisnegativelycorrelatedwiththeinformationasymmetrybetweenthecompaniesandoutsiders.WealsofindthattheVCcertificationeffectisprominentfortheplatforms'newlenders,whohavegreaterinformationasymmetrywithstartupplatformscomparedtoexistinglenders.Theseresultsareconsistentwith Focarellietal.（2008）,whopointoutthatthecertificationeffectincreaseswithinformationasymmetry.Inaddition,weexaminecustomerresponsetoVCinvestmentannouncementsusingpropensityscorematchedpairsofVC-backedplatformsandplatformsthathaveneverreceivedVCinvestmentandfindconsistentresults.

ChemmanurandYan（2009） notethatadvertisingcanbeasignalthatreducesinformationasymmetryassociatedwithadvertiserfirms.Thisadvertisingeffectcanpotentiallyexplainanincreaseincustomerresponse.Toalleviatethisconcern,wefirstexplorethedynamicsofthenumberofnewseventsaroundthetimeofVCinvestmentannouncementstoprovideindirectevidenceoftheadvertisingeffectoncustomerresponse.WealsofindthatVCinvestmentsizeisnotassociatedwithcustomerresponse.Therefore,thesupportingevidenceshowsthatourbaselineresultscannotbeentirelydrivenbytheeffectsofnews,advertising,orfunding.GiventherecentcollapseoftheP2PmarketinChina,wedocumentthatVC-backedplatformsarelesslikelytodefaultthannon-VC-backedplatforms.ThisresultprovidesindirectevidencethatVCbackinghaslong-termbenefitsforportfoliofirms.

ThisstudyisthefirsttoexaminetheroleofVCcertificationbyexploringwhetherVCscertifythequalityofstart-upsbyreducinginformationasymmetrybetweenstart-upsandtheirpotentialcustomers.Thestudyalsocontributestotheunderstandingofventurecapitalfinancing'sroleincreatingvalueforentrepreneurialfirmsingeneralbydocumentingthecertificationroleplayedbyVCsincustomerresponse.Inaddition,ourstudyaddstothegrowingliteratureonventurecapitalfinancing'svaluecreationforstart-upfirmsinemergingmarkets.Thecertificationeffectincapitalmarketshasbeenwelldocumentedsince1990（Barryetal.,1990; MegginsonandWeiss,1991）.VCbackingmayprovidevaluablecertificationtooutsideinvestorsandreduceIPOunderpricing.Inadditiontothecertificationeffect,VCscanimproveefficiency（Chemmanuretal.,2011）,providementoringservicestofirms（Hsu,2004; Cochrane,2005）,playanadministrativeroleinVC-backedfirms（Barryetal.,1990; Lerner,1995; Hellmann,1998）,stimulateinnovation（Bernsteinetal.,2016）,andimprovethetimingofIPOs（Lerner,1994）.VCscanalsocreateproductmarketvalueandfinancialmarketvalueforportfoliofirmsbyformingsyndications（Tian,2011）.Inemergingmarkets, ChengandSchwienbacher（2016） investigatethechoiceofChineseVC-backedcompaniesbetweenlistingonthedomesticmarketorforeignstockmarkets.TheyfindthatcompaniesbackedbyforeignVCsaremorelikelytolistonforeignstockmarkets. JohanandZhang（2016） provideevidencethatabetterbusinessandlegalenvironmentisassociatedwithsuccessfulexitsofPE（privateequity）managers.Incountrieswithhigherlevelsofcorruption,PEmanagerscanincreasetheprobabilityofexitsthroughIPOs. CummingandZhang（2019） findthatrelativetoPE/VCfunds,angelinvestorsaremoresensitivetoeconomicconditions.InvesteefirmsfundedbyangelsarelesslikelytosuccessfullyexitineitheranIPOoracquisition.OurpaperfocusesonthecertificationeffectofVCsforstart-upfirmsbycertifyingtheirvaluetocustomersinanemergingmarketratherthantheroleVCsplayintheexitchoiceorperformanceofstart-upfirmsinemergingmarkets.

Second,ourstudycontributestotheliteratureontherealeffectsof