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In this paper, we investigate the effect of acquiring SMEs as a target on shareholder returns of listed firms that acquired a listed firm on the KSE KOSDAQ market, or a private firm. We examine a sample of 353 mergers from 1991 to 2006, employing SME criteria defined by the Korean Small Business Act for firm size. For the purpose of this study, we control the merging merged firm’s characteristics based on whether or not the acquired firm is private where the acquirer is listed. The gains for an acquiring firm’s shareholders are estimated on cumulative abnormal returns over the eleven-day event window (-5, +5) using the market model. The parameter for the market model is estimated over a (-206, -6) interval.
In addition, we examine the extent that the gains to the acquiring firm depend on relative size of capital. We also regress the effects of the acquiring firm by size combination between the acquiring acquired firms on their characteristics based on whether or not the acquired firm is private, where the acquisition is listed, whether or not acquisition occurs in the 2 digit SIC codes.
Our major findings are summarized as follows：First, we find that an acquiring firm that merged a small private firm based on SME classifications gets significantly better returns than a merger that acquired a public or large target. Second, we show that the gains are greater for the acquisition group with a high relative capital ratio compared to the low group. Third, we report that there is a close relationship between the effects of acquiring SME target with high relative size through regression analysis. Our findings indicate that the acquisition yields positive gains when the target is a small firm or firm with a high relative capital ratio. In particular, these gains are higher when the merging firm acquires the private firm when the acquiring is listed on the KSE market. We suggest that there is a strong need for acquisition merger (M&A) between large public firms small private firms in the Korean economy. We believe that this combination helps a large firm to exp growth opportunity. Our recommendation is supported by our findings. As for SMEs that have limited capability in fund raising, human resources, market networking, etc. the scale economy a restructuring effect can be expected from the M&A.

In this study, we sampled 64 companies that were invested by venture capitalists 64 that were not among the corporations listed on the KOSDAQ market from Jan 2004 to Dec 2006. We studied the role of venture capitalists through analyzing the abnormal rate of return of our samples.
This study is meaningful in a sense that it analyzed the problems of venture capitalists proposed the proper role of them in order to nurture venture companies vitalize the KOSDAQ market through improving regulations on venture capital industries.

This study aims to examine effects of both trust in managers trust in peer employees on individual performances, such as quality enhancement innovation activities, at internet firms. It also examine the mechanism by which trust in managers trust in peer employees affect quality enhancement activity innovation activity directly indirectly through their effects on organizational commitment. This study develops a research model, which includes trust in managers trust in peer employees as independent variables, organizational commitment as a mediating variable, individual quality enhancement activity innovation activity as dependent variables. This study tests the research model employing 126 survey data from internet venture firms.
The result of the empirical analysis presents that both trust in managers trust in peer employees turn out to be significant determinants of organizational commitment. Organizational commitment appears to be a determinant of innovation activity quality enhancement activity. Trust in managers appears to affect innovation activity in a positive direction indirectly through its effect on organizational commitment, but not directly. Trust in peer employees makes a positive effect on quality enhancement activity directly indirectly through its effect on the mediating variable of organizational commitment. What is clear from the research results is that the relative importance of the antecedent variables, i.e. trust in managers trust in peer employees, of two individual performances such as quality enhancement activity innovation activity.

The purpose of this study is to identify the effects of trust distrust of the internet store users toward the online market entry firm. The small medium sized firms' lack of resources often causes the service variability problems in the market. Thus, consumers’ distrust toward the service failure is the most critical entry barrier for the online market entry firms. However, small medium sized firms could not create the sufficient transaction histories to control these kinds of distrust. This study explores the role of the initial trust to create the customer satisfaction loyalty with the mediating effect of trust/distrust constructs.
The empirical results shows the structural independence of the initial trust, trust distrust. Furthermore, the initial trust could affect the trust/distrust constructs separately. The asymmetry of the role of trust distrust is also shown to create the customer satisfaction loyalty.
The managerial implications of the study are as follows. First, small medium firms which could not have the sufficient transaction history in the online market should carefully manage the cues that signals the initial trust. Second, simultaneous management of both trust distrust for the online market entry firms. Third, distrust influences the customer loyalty but play no role in creating or destroying customer satisfaction. The major contribution of the study is to show the different role of initial trust, trust distrust to create the relational outcomes.

KIBO Technology Fund (KIBO) provides technology guarantee to small medium-sized enterprises (SMEs) with proven technology so that they can borrow needed funds from banks financial institutions. This study investigates whether technology guarantee by KIBO has the positive financial effect on SMEs by comparing the financial performance of guaranteed SMEs with that of general SMEs. The sample consists of 664 SMEs guaranteed via technology evaluation by KIBO from year 2001 to year 2006, for which all the necessary financial data are available over four consecutive years counting from the year before the guarantee. The empirical results show that each of operating income, pretax income, value added on sales of guaranteed SMEs becomes significantly higher than that of general SMEs after technology guarantee. Further, their R&D investment remarkably increases after the guarantee. Operating income, pretax income, value added on sales are particularly higher in venture or start-up firms, R&D investment in venture firms after the guarantee. Although their sales growth decreases after the guarantee, its level after the decrease is still considerably higher than that of general SMEs. Their debt-to-equity ratio remains basically the same while their current ratio becomes higher after the guarantee. This provides evidence that technology guarantee helps SMEs, particularly venture or start-up firms, improve their profitability, generate higher value added for the national economy, boost R&D activity for future technology innovation. In addition, technology guarantee seems to aid SMEs in maintaining high growth enhancing short-term financial stability. This study suggests that it is necessary to exp technology guarantee for SMEs, particularly venture or start-up firms among them.

This paper investigates policy issues to promote the role function of Community Credit Bank such as Korean Community Credit Bank(KCCB) Credit which makes a contribution to minimize the transaction cost for financial access for small business men who occupy 94.2% of total number of firms employ 50.1% of total employee, for income class below the average with low credit score. The loan price of the Community Credit Bank is a bit higher than that of bank, but much less than that of usurer, hence the function of the Community Credit Bank to establish the financial hierarchy has to be reinforced with the support of local governments, local credit guarantee, Small Business Administration. To reinforce asset quality profitability, the ratio of non-interest profit has to be increased through dealing with government loan expenditures exping the scope of economy in KCCB, then KCCB’s lending rate for income class below the average could be lower. The Department of Administration Security, local governments have to play a crucial role in supervising KCCB for the check balance of supervision. Finally, the KCCB system to help LDCs alleviate the poverty achieve self-support has to export as an important instrument of ODA could be the winner of Nobel Peace Prize.