›› 2017 ›› Issue (03): 84-92.

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Analysis of Venture Capital Institutions' Preference in Internet Finance platforms

Li Xian-ling, Wang Yan   

  1. South-Cenral University for Nationalities, Wuhan Hubei 430074, China
  • Received:2016-11-23 Online:2017-05-15 Published:2017-05-26

Abstract: As one of emerging industries, internet finance platforms were often lack of funds. So it was critical to obtain the venture capital for overcoming the capital bottleneck. In order to guide venture capital in internet finance industry, this paper adopted the real options methods to analyze the preference of venture capital institutions in internet finance industry. We found that the increasing of the demand drift rate and government favorable policies will have a positive impact on the opportunities that Internet finance platforms obtain the venture capital investment. While the higher the demand volatility and risk-free interest rates are, the smaller the chance of getting venture investment is. Therefore, some measures should be taken to provide the internet finance platforms with sufficient funds. On the one hand, platforms must strengthen their own business innovation, improve the internal management level, and standardize their operation behavior in order to maintain the steady growth of business. On the other hand, the support and guidance from government are also important.

Key words: internet financial, real options, venture capital

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