Abstract: Since the 1990s , with the acceleration of global economic integration process , venture capital showed a trend of internationalization, this investment behavior formed a new kind of international investment activity - cross-border venture capital investment. In recent years, cross-border venture capital occupies a pivotal position in the venture capital market in China . The main purpose of this paper is to explore whether localization experience is crucial to cross-border venture capital performance. After a review of the previous studies on the basis of literature ,this paper uses a dataset of 551 exit cases of cross-border venture capital from 1998 to 2012 as research materials.Based on previous measurement of foreign venture capital institution’s human resource, this paper improves and proposes a mesurement of cross-border venture capital’s localization experience in Chinese market from three aspects. The main conclusions are as follows: the age of investment time in the Chinese market and local industry experience are significant factors for the cross-border VC performance, that is, the longer of investment time in Chinese VC market and more investments involved in a certain industry, the better performance of a cross-border VC firm. What’s more, the investment duration and exit ways are also the determinants of cross-border venture capital performance.

Key words: cross-border venture capital, exit performance, IRR, localization experience