Abstract
This article divides the cooperation style between start-ups and venture investors into non-property cooperation and property cooperation. On the basis, it sets up a dynamic game model of complete information to figure out the corresponding Nash equilibrium. And the game analysis results indicate that during the cooperative game process of start-up and venture investor, the higher extra input the venture investor needs to provide, the more likely the both sides are to choose non-property cooperation; the higher profits the success of the venture project may bring, the more likely the entrepreneurial firm is to choose property cooperation.
Highlights
As the Prime Minister of China, Li Keqiang, came up with in the government work report in 2015 that: “Mass entrepreneurship and innovation can create more jobs and increase personal incomes, and improve upwards social mobility and social equity and justice”
By introducing the property and non-property cooperation into the game model, it is from a new perspective to study the relationship between start-up and venture capitalist theoretically, which is more simple and effective for both sides to lower the risk and uncertainty to some degree
As for the factors influencing the cooperation, start-up and venture investor can take the amount of funding, extra investment, entrepreneurial success estimated value etc. into consideration when deciding to choose the cooperation style
Summary
As the Prime Minister of China, Li Keqiang, came up with in the government work report in 2015 that: “Mass entrepreneurship and innovation can create more jobs and increase personal incomes, and improve upwards social mobility and social equity and justice”. Startups may apply for loan from banks or other financial institutions, in which the loans’ standards are too high for start-ups to live up to. The cooperation between start-ups and venture capital investor is a win-win behavior, becoming an overwhelming trend. Both of them face unprecedented uncertainty and risk control in the cooperation process. In order to lower the uncertainty and risk, lots of researches have been conducted to study the cooperation of start-up and capital investor to offer them appropriate strategies, eventually the issue is becoming a hot topic. This paper will focus on the game process in their selection and negotiation stage by the method of game theory and seek equilibrium strategy for gaming parties
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