Abstract

India has become one of the major recipients of venture capital (VC) in the last decade. It is important to understand if the factors that have played an important role in influencing the VC investment in developed countries are of relevance in the context of developing countries as well. The purpose of the study is to explore the various dimensions of VC investments in India with respect to factors such as industry of investment, stage of investment, round of investment, stake acquired, geographical location, syndication, investor type, etc. and their impact on the amount of investment. A descriptive and empirical research has been carried out using VC investment deals in India during the period from 1st January, 2004 to 31st October, 2016. It is found that the amount of investment by a VC fund in an undertaking is primarily influenced by the stage of investment and the stake acquired. Investor type and industry are also found to have a significant effect on the funding amount. While economic growth and market index are found to have a very small effect on the amount of VC funding, geographical location and syndication donot seem to have any effect on the amount invested.

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