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What Matters in Venture Capital: Evidence From Entrepreneurs’ Stated Preferences

Bengtsson, Ola LU and Wang, Frederick (2010) In Financial Management 39(4). p.1367-1401
Abstract
We study how entrepreneurs evaluate the ability of different US venture capitalists (VCs) to add value to start-up companies. Analyzing a large data set of entrepreneurs’ stated preferences regarding VCs, we demonstrate that entrepreneurs view independent partnership VCs more favorably than other VC types (e.g., corporate, financial, and government sponsored VCs). Although entrepreneurs are able to correctly identify VCs with better track records, they do not believe them to be more desirable investors. We also find that an entrepreneur's rankings are affected by their overall exposure to VCs, emphasizing the role of experiential learning in the venture capital market.
Please use this url to cite or link to this publication:
author
organization
publishing date
type
Contribution to specialist publication or newspaper
publication status
published
subject
keywords
Venture Capital, Entrepreneurship
categories
Popular Science
in
Financial Management
volume
39
issue
4
pages
1367 - 1401
publisher
Wiley-Blackwell
external identifiers
  • scopus:78650069726
ISSN
0046-3892
DOI
10.1111/j.1755-053X.2010.01116.x
language
English
LU publication?
yes
id
c4ba3217-528d-4f3b-9716-e98db22ccec1 (old id 3629068)
alternative location
http://onlinelibrary.wiley.com/doi/10.1111/j.1755-053X.2010.01116.x/full
date added to LUP
2013-04-03 09:18:54
date last changed
2018-05-29 12:13:42
@misc{c4ba3217-528d-4f3b-9716-e98db22ccec1,
  abstract     = {We study how entrepreneurs evaluate the ability of different US venture capitalists (VCs) to add value to start-up companies. Analyzing a large data set of entrepreneurs’ stated preferences regarding VCs, we demonstrate that entrepreneurs view independent partnership VCs more favorably than other VC types (e.g., corporate, financial, and government sponsored VCs). Although entrepreneurs are able to correctly identify VCs with better track records, they do not believe them to be more desirable investors. We also find that an entrepreneur's rankings are affected by their overall exposure to VCs, emphasizing the role of experiential learning in the venture capital market.},
  author       = {Bengtsson, Ola and Wang, Frederick},
  issn         = {0046-3892},
  keyword      = {Venture Capital,Entrepreneurship},
  language     = {eng},
  number       = {4},
  pages        = {1367--1401},
  publisher    = {Wiley-Blackwell},
  series       = {Financial Management},
  title        = {What Matters in Venture Capital: Evidence From Entrepreneurs’ Stated Preferences},
  url          = {http://dx.doi.org/10.1111/j.1755-053X.2010.01116.x},
  volume       = {39},
  year         = {2010},
}