The pattern, evolution, and mechanism of venture capital flows in the Guangdong-Hong Kong-Macao Greater Bay Area, China

As an important innovation flow, venture capital has been examined in urban network research. However, the segmentation of capital categories and the cross-scale connection of capital remain scarcely analyzed. This study focuses on the structure and industry differentiation of venture capital flows in the Guangdong-Hong Kong-Macao Greater Bay Area (GBA) and its cross-scale network characteristics. Based on a venture capital database covering capital amount, investment subject address information, and industry information (2000-2018), this article examines the spatial distribution and network structure of venture capital in the GBA by means of a distance-based test of spatial concentration approach and social network analysis. Key findings show that: (1) Venture capital institutions and startups in the GBA present a high-concentration distribution pattern. In the past 20 years, venture capital activities in the GBA have substantially increased, forming a complex urban network structure with Guangzhou, Shenzhen, and Hong Kong as the core of this network. (2) Different types of venture capital show significantly different urban network structures, with manufacturing, the Internet industry, the financial sector, the cultural media industry, and the medical and health industry as the five industry types with the largest capital flow in the GBA. (3) Cross-scale research on the venture capital network reveals the position of the GBA as a capital hub in China, which forms a dense venture capital connection network with major cities on a national scale. (4) The network structure of venture capital in the GBA is influenced by multi-dimensional proximity, institutional factors, urban economy, and path dependence. Along with these three key mechanisms, the GBA has grown into a national-scale and even global-scale venture capital center.