Abstract
The first systematic analysis of venture capital inEurope is conducted using Euro.nm, the alliance of Europe's new stock marketsfor innovative companies in high-growth industries, similar to the U.S. NASDAQ.The data set used was developed by collecting information from the listingprospectuses and annual reports of 527 companies that went public on Euro.nmfrom its inception in 1997 to December 2001. The role of European venturecapital in the companies it finances is also examined. The views presented challenge some common beliefs about the role of venturecapital in Europe and question its ability to make a difference for economicgrowth and job creation. It is argued that venture-backed companies do not growand create jobs faster than non-venture-backed companies. Findings indicate that venture capital does help innovative Europeancompanies by providing crucial financing for their creation and development.However, venture-backed firms do not create more new jobs thannon-venture-backed firms, and venture-backed firms are not systematicallydifferent from non-venture-backed firms. They also do not grow faster eitherbefore or after initial public offering. (JSD)
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