Abstract
Unlike other types of finance providers, the contribution made by venture capitalists (VCs) to the small and medium-sized enterprises (SMEs) they back is not strictly financial in nature. Because they have a stake in the firms' profits and losses, they often play an active role as investors, for example by helping to introduce business processes and practices conducive to long-term development and performance. This type of contribution has not been examined in depth in previous research, since authors have tended to concentrate on the financial contribution of VCs and its impacts on stock market performance. However, the stock market is no longer the principal outlet for VCs, particularly when they work with firms in traditional sectors, and we therefore felt it was appropriate to examine a sample of SMEs in order to identify the impacts of VC activities. A statistical study of the strategic capabilities of VC-financed and non-VC-financed SMEs revealed significant differences in favour of the former group. On the other hand, most of these differences no longer existed when we restricted our sample to gazelle-type SMEs with similar growth rates. This specific finding may reflect a client effect, in that, as other authors have pointed out, firms approached by VCs need to exhibit real potential for growth and profit. Given this, it is not possible to affirm that the more sophisticated development exhibited by the VC-financed firms is due specifically to the VCs' interventions, a situation that raises a number of other research questions.
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