Venture capital firms in China influence the performance of companies they invest in. VC-backed firms in China have higher underpricing levels in the stock market compared to non-VC backed ones. However, VC participation helps improve the performance of their portfolio companies after they go public. Independent VCs have better post-IPO performance than other types of VCs, but local Chinese VCs perform worse than foreign VCs in controlling underpricing. Chinese IPOs have more underpricing than those listed in the US and Hong Kong markets. VC reputation does not affect portfolio company performance. The influence of VCs decreases two to three years after the IPO when they exit their investment.