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3.0 Research Design……………………………………………….7
3.1 Research Hypothesis………………………………………….7
3.2 Data……………………………………………………………….8
3.3 The measurement of Data…………………………………….9
3.4 Variable…………………………………………………………11
3.5 Regression Model…………………………………………….12

4.0 Results analysis………………………………………………13
4.1 Descriptive statistics…………………………………………13
4.1.1 Basic situation………………………………………………...13
4.1.2 Change of indicators…………………………………………13
4.1.3 The effect of IPO on the profitability of companies…….15
4.2 Significance Testing……………………………………………16
4.3 Regression Analysis……………………………………………16

5.0 Conclusion and suggestions…………………………………17

Appendix……………………………………………………………..20

Reference……………………………………………………………..22

5.0 Conclusion and suggestions

The paper takes examples from the past study about the change of financial situations before the IPO and after IPO. In addition, the paper focuses on the emerging market and analyzes it through descriptive statistics, significance analysis, comparative research and then build up a regression equation, and finally find out the effect of venture capital influence on IPO performance and draw the following conclusions and interpretations:

(1) The overall effect of listed company in GEM

From the point of view of profitability, the ROA, operating profit margin, operating cost rate reach the optimum in a year before the IPO while there are significant deterioration trends a year after IPO; ROE presents the declining tendency and decreased significantly, which suggested that VC did not bring benefits to the performance of listed company in GEM, on the contrary, it has helped to drive performance decline. The ability of earning revenue, cost management are back. So, the effect is highlighted in terms of profitability.
Because prior to the IPO, the company should announce the first two years financial statements before IPO, this is the most direct way for investor to command the firsthand information about the listed company before IPO. In order to get the favour of investors and to raise funds, listed companies are inclined to have earnings management before IPO, some costs which should be included in the current year will be deferred to the year after the IPO. So the company intended to be in good condition, and strong position of earning profits . In that year, the rate of operating cost has no change, but ROA, ROE and operating profit rate have deteriorated markedly, this shows under the condition of that the company cost management has no change, the net profits decreased a lot, this may be evidence that the company has carried on the earnings management.