The impact of venture capital on enterprise innovation and its internal mechanism are still controversial in academia. Taking the A-share listed companies from 2000 to 2016 as the study object, the article uses the instrumental variable method to empirically study the impact of venture capital entry on the innovation output of enterprises three years after being listed. The study found that: (1) the participation of venture capital can significantly promote the quantity and quality of enterprise innovation output, which indicates that the cultivation effect plays a major role in the mechanism of venture capital impacting enterprise innovation; (2) management myopia serves as an intermediary in the promotion of enterprise innovation by venture capital. After venture capital enters, the amount and intensity of enterprise R&D investment are significantly increased by alleviating management myopia; (3) the introduction of other institutional investors through follow-up financing services and the provision of value-added services to reduce enterprise risk are two important mechanisms for venture capital to alleviate management myopia.
