Formation of Chinese venture capital syndication network

Using a dataset that recorded a large number of investment transactions in China from 1991 to 2018, we examine the statistical properties of the Chinese venture capital (VC) syndication network. Our main findings are as follows. First, the number of investment transactions sharply increased after 2014. Second, more than half of the VC firms are located in Beijing, Shanghai, and Shenzhen. Third, the degree distribution becomes roughly straight on a log–log plot. Fourth, the hypothesis that the degree distribution follows a power-law distribution is not rejected for 2015 and 2016. Fifth, better connected VC firms increase their connectivity faster, which suggests the existence of preferential attachment.