Abstract

Since the 1980s, the stage selection differentiation becomes an important feature of US venture capital institutions heterogeneous development. Then, the stage selection phenomenon also has presented in different countries during the development of venture capital. After the introduction of venture capital system by Chinese, the preference for the investment of late stage project becomes prominent. Previous studies have indicated that the stage selection will have a great effect to the invested enterprise. Therefore, it is of practical significance to understand the formation mechanism and influencing factors of the stage selection. For stage selection phenomenon, theorists have studied from the micro and macro levels. However, there are some problems in the research of design flaws and conclusions. In recent years, research has shown that tacit knowledge can provide a theoretical analysis source for the study of behavior. Combined with the current status of research, from the perspective of tacit knowledge for further study of the venture capital stage selection behavior, it becomes a logical idea.

The goal of the article lies in the following aspects: ①clarifying the mechanism that the tacit knowledge affecting action of decision-making behavior in the uncertain environment; ②testing that the tacit knowledge affecting venture capital stage choice on surface of the micro layer; ③verifying that macro factors of effecting（reflection）tacit knowledge affecting stage choice.

The first part of the paper is a research on the mechanism how tacit knowledge affects stage selection.

This part starts with justifying the adoption of agent heterogeneity hypothesis as the paper's theoretical premise from three dimensions—economic environment and academic development stage, significant features and the impacts on the value of economic theories.

Secondly, in light of the context and perspectives, the paper classifies and analyzes the existing research findings on uncertainty, and then draws the following conclusion: the uncertainty in this paper is one with a comprehensive angle and within the decision-making context, and is produced and determined by the joining of agent internal heterogeneity（endogenous uncertainty）and external environmental differentiation（exogenous uncertainty）.

Thirdly, the paper studies the decision-making mechanism of venture investment. Rationality degree is the major factor in determining the degree of endogenous uncertainty borne by venture capitalists（decision-making teams）. Highly rational venture capitalists（decision-making teams）are more likely to choose the entire rationality model, leading to an extremely high satisfactory level（extreme value）which is used to screen programs; venture capitalists（decision-making team）with a low degree of rationality are more likely to choose a bounded rationality model, leading to a low satisfactory level（satisfactory value）which is used to screen programs. However, no matter which decision model is used, the ultimate aim of its decision-making is to get the best return on investment under the constraints of the agent's internal conditions. Decision results will be a balanced solution, which is when the exogenous uncertainty determined by the program's stage characteristics matches the endogenous uncertainty determined by the rationality degree of the decision-making body, the search will come to a stop and the decision results produced.

Finally, the paper probes into the tacit knowledge and its influence paths. By linking tacit knowledge with uncertainty, we expand the measurement system of tacit knowledge, including professional experience, feedback of results, similarities of cultural background, openness of background culture, and innate comprehension ability.

Increasing the tacit knowledge will improve the degree of rationality of the decision-making body, triggering a change in the adopted decision-making model. It further causes the decision-making body to set higher satisfaction levels; the programs that are at a more forward stage and need more searching costs must be factored into the consideration of venture investment. Once such programs become the proposed investment programs, it means an increase in exogenous uncertainty. In the face of higher uncertainty, decision-makers need a higher degree of rationality in response. Only when the increase of exogenous uncertainty matches again the endogenous uncertainty determined by the new rationality level, the search stops, stage selection is completed and a new equilibrium is formed

Tacit knowledge affects stage selection through such specific paths, including: on the micro level, it directly affects the initial investment choices and overall investment strategy; at the same time, tacit knowledge affects the overall investment strategy indirectly through the initial investment choice; on the macro level, macroeconomic factors affect the behavior characteristics of regional venture investment by way of influencing the professional experience and background culture.

The second part of the article is about the status description of the venture capital stage choice, and if or not the choice behavior of the stage in our country has a substantive impact inspection.

Through quantitative analysis we can see that venture capital in China has obvious stage choice differentiation phenomenon firstly. The overall preference of the different years of the choice of the total preference has fluctuated, but there is no obvious regularity of the deposit. Secondly, the foreign venture capital also has the obvious stage choice differentiation, the domestic and foreign venture investment stage choice overall preference fluctuation does not have the synchronization. Lastly, from 2010 to 2013, foreign venture capital investment in the early stage of the project investment ratio is higher than the domestic.

Empirical test results show that the stage selection behavior of venture capital will have a substantial impact to Invested enterprise. The results show: ① In a sub sample of venture capital, when VCs invest firm in early stage, it can promote more R&D investment than in later stage, boosting the growth of firm significantly, and enhancing the firm's profit ability significantly;② In the full sample including no venture capital investment, VCs investing firm at later stage are worse than not enter, because they get negative effects on firm's growth. There is no significant impact on firm's profit ability when VCs invest firm at later stage; ③ Venture capital enter the enterprise in the late stage, resulting in a decline in the role of the boost, and even have a certain side effects, reducing the overall risk of investment in the economy to boost the economy.

The third part of the article is testing the influence of the tacit knowledge to venture capital stage choice on the micro level.

Tacit knowledge influences the stage of investment for the first time to choose the test results show that the decision-making team before entering the organization form of tacit knowledge in ① the more entrepreneurial experience, the greater probability venture capital chooses early stage project in the first time; ② The more research and development experience, the smaller probability venture capital choose early stage project in the first investment project in long distance, and the more research and development experience, the greater probability venture capital choose early stage project in the first investment project in short distance; ③ the more developed areas overseas work experience, the greater probability venture capital chooses early stage project in the first time; ④ the more financial work experience, the smaller probability venture capital chooses early stage project in the first time; ⑤ compared with the long distance investment, venture capital has more probability choosing early stage project in the first time investment when the distance is short; ⑥ Tacit knowledge is more significant influence on investment stage of choice for the first time than clear knowledge.

The test about tacit knowledge influencing subsequent overall investment strategy shows that: ① the first time investment chose has remarkable effect on the subsequent overall investment strategy; ② the first time investment successful IPO will attract venture capital choosing late stage; ③ the more investment, the more venture capital preferences late stage project in subsequent overall investment strategy;④ research and development experience has a significant positive impact for the probability of early stage project in the subsequent overall investment strategy; ⑤ professional experience before entering the institutions have an impact on subsequent overall investment strategy, but significantly decreased; ⑥ education background of administration has significantly increasing affection to overall investment strategy.

The fourth part is to test that tacit knowledge affect phase selection at the macro level.

Theoretical analysis showed that the regional industrial structure affects the tacit knowledge of venture capitalists before and after entering institutions. Regional culture influences the degree of the spread of the tacit knowledge.

The results of static model show that: ① the stronger the industrial enterprise profit ability and the second industry more developed or position more important, the more unfavorable to early stages venture capital investment; ② The results also show that the stronger the population mobility and the lower degree of risk aversion, the more favorable to early stage venture capital investment; ③ The more IPO numbers in history in region, the more venture capital chose later stage item; ④ Personal income tax rate have a negative impact for venture capital choosing early stage item. The results of dynamic model show that: ① venture capital stage choice behavior was affected by its own law of development; ② After control the impact mentioned, as the exogenous influence factors, industrial structure and culture still show the expected influence. This chapter test proved that the tacit knowledge in the macro level may also affect venture capital stage choice.

Core conclusion is: Firstly, stage selection of venture capital will indeed have a substantial impact; Secondly, tacit knowledge has a significant impact on the venture capital stage selection; and finally, the macro factors of industrial structure and regional culture affect stage selection.

The innovation of this article is mainly manifested in the following aspects: ① The article first proposed to analyze uncertainty from context and perspective; ② The article analyzes the mechanism of tacit knowledge affecting stage selection; ③ The article testes that tacit knowledge has affection to venture capital stage selection.

Keywords: Venture Capital; Stage Selection; Tacit Knowledge;Uncertainty