The Risks Control of China's Venture Capital and the Stimulus of Partnership Enterprise Law

Correspond with the risk of the rights of distribution and optimize the management decision-making mechanism, Limited partnership companies is different from traditional limited company governance. Assuming a major investor with limited responsibility for the limited partners and at least one general partner has the right to operate with unlimited liability in limited partnership. Capital business and risk management through a series of venture capitalist investment behavior. Interests distribution not only is based on money but on "contribution" and "risk" factors. Such a legal arrangement will unify objectives of investors and venture capitalists reducing risk of opportunistic behavior of venture capitalists and improving the level of effort.