Venture Capital Organizations Research Articles

Relational Work and Accounting: What Venture Capital Analysts Do with Accounting and Other Information in Situations of Uncertainty

Analysts in venture capital (VC) organizations are important mediators in the entrepreneurial economy, operating as both ‘scouts’ and ‘coaches’ of early-stage ventures. Research shows that these analysts invest heavily in collecting and scrutinizing accounting and a wide range of other information at all stages of their work. However, we lack an integrative theorization of how, in the presence of fundamental or ‘Knightian’ uncertainty, analysts effectively use this information. We explore this topic through interviews with VC analysts and project makers operating in Denmark in 2009 and 2010. Drawing on and extending the work of Viviana Zelizer, we show, firstly, how the multiple, different uses of accounting and other information function in relation to each other and the communication and transformation of social relations. Each stage of analyst work involves a double movement in which economic media is differentiated and the relationships between analysts and project makers and their ventures are created, negotiated, maintained, and changed. Secondly, we show how this double movement provides an indirect and ‘ontological’ mode of handling situations of uncertainty in which accounting information adds matter and form to the new business venture. We conclude by exploring opportunities for further applications of relational work in accounting research.

Impact of Venture Capital on the Dividend Policy of Listed Companies and Management Platform Design

This paper uses the data of Chinese A-share listed companies from 2003 to 2019 to study the impact of venture capital holdings on the dividend policy of listed companies. The research findings show that venture capital holdings increase the willingness to pay cash dividends and the payment level. This conclusion still stands after using the PSM matching method and other robustness methods, indicating that there is causality between venture capital holdings and the dividend policy of listed companies. Further research finds that the course of action for venture capital holdings to increase the willingness of listed companies to pay cash dividends and their dividend payment level is to increase the dividend payout ratio by alleviating the company’s agency level. Further research finds that different types of venture capital will also have an impact on the dividend policy. Foreign investment venture capital organizations are more favorable for increasing the willingness of listed companies to pay cash dividends and their dividend payment level. In addition, the impact of venture capital holdings on the dividend policy is more obvious in the central and western regions where economic development is relatively backward and is less obvious in the eastern regions. Based on J2EE, a venture capital information management platform is designed and developed. The research of this paper shows that venture capital shareholding plays an important role in promoting dividend payment of listed companies, and has enriched the research results of the value-added role of venture capital. At the same time, from the perspective of dividend policy, it has brought to light the corporate governance effectiveness of venture capital and has provided certain theoretical evidence for the assertion that capital can better serve the real economy.

Making Partner*

AbstractAssociates need reputation and financial resources to make partner at law firms, consultancies, and venture capital organizations. We provide a theory for how this prospect influences the business risk strategy they pursue and their execution effort. In our model, business risk affects how reputation evolves and the benchmark reputation for making partner through the impact of execution effort on the financial resources accumulated. We show that when business risk is observable, associates with good reputation take on high business risk, as opposed to low business risk, in order to protect their reputation. We also show that opening partner positions decreases the effort incentives of the associates with the best reputation. Finally, we conjecture that wage dispersion at the associate level should be higher when business risk is unobservable.

The Extent of Social Contribution of Venture Capital Organisations to Funded Financed Companies

The major objective lying behind the conduction of the present work lies in investigating the social advantages likely to be brought about by the venture capitalist to the funded firm. More specially, it treats the venturer’s financial contribution as based on a number of human resources management related practices. Overall, the reached results, relevant to a sample involving 150 companies proved to indicate that the financial participation of this mode of financial intermediation turns out to be partially associated with a social contribution. In effect, it has been discovered that a number of the advanced practices, suggested as social contribution relating measures, do not prove to stand as part of the changes targeted by the venture capitalist to take place in a bid to enhance the firm’s social performance, nor were they intended to further improve the added values already achieved. Actually, such a strategy could well reflect some special features characterize the Tunisian venture capital mode of financing.

VENTURE FINANCING OF INNOVATIVE PROCESSES IN AN AGRICULTURE OF UKRAINE


 
 
 The article reveals the peculiarities of ventures investigated the sources of their funding. The problems of venture financing innovation enterprises of the agricultural sector. The problems and prospects of development of venture investment in Ukraine. Found that in Ukraine is a source of venture capital organizations, large companies and commercial banks. Today, almost every company has its own venture capital fund that invests in innovative businesses related fields. Unlike the developed foreign countries in Ukraine basic research in the agricultural sector financed only by the state. This fact provokes the creation of favorable conditions for attracting private and foreign investments for the development of research and innovation in agriculture.
 
 

The Venture Capital Divide: Germany and the United States in the Post-War Era

This paper analyzes and explains the disparate paths of development among venture capital organizations in the United States and Germany over the post-World War II period, contrasting the early emergence and burgeoning of the sector in the U.S. with the lagging development in Germany. The paucity of venture capital in Germany throughout the latter half of the 20th century is often seen as a result of that country’s system of large, powerful universal banks and small, inactive capital markets. Lack of acceptance may additionally appear to result from cultural or social differences that make Germans suspicious or skeptical of such risk taking and disdainful of the capitalistic drive it represents. I argue instead that a complex of political, social, and economic factors — many dating back to institutions put into place in the 19th century — explains the evolution of venture capital over the post-war era. These factors differed radically between the US and Germany and produced divergent outcomes for venture capital institutions a century later. I emphasize the crucial role of the available pool of qualified, potential entrepreneurs and the incentives that either drove or hindered high-technology venturing, particularly during the middle of the twentieth century.

The cognitive contribution within the Tunisian venture capital funded firms

The present research work’s major objective lies in investigating the scope of the venture capitalist’ cognitive contribution following their financial participation in the company's capital. Conducted on a sample of 70 Tunisian venture capital funded firms, operating up the year 2015, the survey reached findings have proved to reveal well the significant impact this financial intermediation mode appears to have on kindling cognitive resources, in its association with the contractor. Noteworthy, however, is that the cognitive contribution has been discovered to be constrained, in turn, by the venture capital organization’s proper ownership structure.

Mobilizing Diaspora Entrepreneurship for International Development Initiatives

A Diaspora is a large group of people with a similar heritage or homeland who have since moved out to places all over the world. It can also refer to the movement of the population from its original homeland. The study of Diasporas provides a useful frame for reimagining locations, movements, identities, and social formations. Diasporas are in a unique position to have a positive effect on the economy of their countries of origin if policymakers there seize the opportunities. Despite the advantages that these entrepreneurs bring, many developing countries have met only limited success in attracting them. Countries with governments that still require aspiring entrepreneurs to follow complex procedures, countries at war, or those experiencing internal conflict and social upheaval remain unattractive to all but the most intrepid Diaspora private investors and business people. This paper primarily aims to give an insight into the nature of Diaspora entrepreneurship. Also, it suggests the framework of mechanism through which donors and international development agencies can constructively promote its developmental impact. Three examples of venture capital and partnership organizations have been quoted. Secondary data have been used in this presentation and nature of analysis is descriptive. The paper concludes that governments, multilateral institutions, Diaspora organizations, and other civil society groups can help Diaspora entrepreneurs to tap the resources they need and clear obstacles to realizing their ventures and accelerating economic growth. Peace, stability, and construction of basic infrastructure are prerequisites for substantial Diaspora investment, as they are for so many other development processes.

Pain Management for Entrepreneurs: Working with Venture Capital

Although information systems security is acknowledged as one of technology's most critical areas of need, there is a sizable gap between available technical approaches to security and the capabilities of current commercial products. This reflects acknowledged issues in technology transfer. The author, a veteran of both information security research and commercial security product venture capital organizations, provides a discussion of the motivations and considerations associated with this part of the technology transfer world.

Factors Affecting Venture Philanthropy Behavior

Drawing upon two theoretical perspectives actively utilized in entrepreneurship and strategic management, i.e., institutional theory and entrepreneurial orientation, I investigate impacts of institutional duality in the field of social entrepreneurship upon entrepreneurial behavior of funders of social ventures, called venture philanthropy-social venture capital (VP-SVC) organizations. To answer why and how some VP-SVC organizations decide to engage with venture philanthropy model, while others do not, I propose a conceptual model to explain how institutional factors of the traditional philanthropic field and the venture capital field make different effects on venture philanthropy behavior of VP-SVC organizations. The results from hierarchical moderated regression support that institutional factors of the venture capital field actually drive venture philanthropy behaviors, while the results from the contingency model remain mixed. Scholars point to a lack of theory-grounded studies in social entrepreneurship. The present study aims to fill this gap and contribute to the field of nonprofit and philanthropic studies by linking to literature of business entrepreneurship.

Perceived Venture Capital Support

Venture capital researchers have struggled to find definitive evidence of the added benefit venture capital organizations can offer new ventures. Additionally, management researchers on the micro a...

The study of venture capital finance and investment behaviour in small and medium-sized enterprises

Small and medium-sized enterprises (SMEs) are often credited with innovative entrepreneurial practices and conceiving new market opportunities. Government has reinforced these positive economic externalities through policy programmes and designated support structures. Venture capital organisations often galvanise innovative knowledge by entrenching and sustaining nascent businesses through value-creating funding behaviours. In this way, the venture capital industry financially supports entrepreneurial activity for economic growth and governs and nurtures the growth of the SMEs. These show that the venture capital industry embraces value-creating opportunities on the basis of rational partnerships with enterprises that have limited track records and less formal control mechanisms. The tentative factor analysis findings suggest an integrated framework for the venture capital industry from the significant intercorrelations among the variables. The most important focus of this article, however, is its attempt to examine the behavioural traits of SMEs and venture capitalists regarding systematic finance and investment for inclusivity and due diligence.

25 Years Of Science Parks In Spain: Towards A New Model Of Development

In the knowledge-based economy, developed and in developing countries are putting an increasingly interest on encouraging their firms to produce, exploit, transfer and apply knowledge. In this context, there seems to be a general agreement about the need to develop and strengthen networking activities using infrastructures to promote knowledge transfer between different economic actors. Science and Technology Parks (STPs) are an important part of these support infrastructures. The main objective of this paper is to analyze how STPs have evolved during the last 25 years in Spain. Therefore with available data we study how has changed their model from a "science push" in the first generation models to a "science pull" for the second generation models of Science Parks. Data from the APTE (Spanish Association of Science and Technology Parks) shows that new parks are redesigning their activities toward a third generation of STPs based on interactive local flows located in science-industry-government relations, increasingly involved with local, regional and even global innovation activities. This paper also analyzes how go-betweens and intermediaries can facilitate the interaction between firms, government and research institutions, and liaise with public and private R&D funding and venture capital organizations.

THE EFFECTS OF VENTURE CAPITAL FINANCE AND INVESTMENT BEHAVIOUR IN THE SMALL MEDIUM-SIZED ENTERPRISES

Small and medium-sized enterprises (SMEs) are often credited with innovative entrepreneurial practices and conceiving new market opportunities. Government has reinforced these positive economic externalities through policy programmes and designated support structures. Venture capital organisations often galvanise innovative knowledge by entrenching and sustaining nascent businesses through value-creating funding behaviours. In this way, the venture capital industry financially supports entrepreneurial activity for economic growth and governs and nurtures the growth of the SMEs. These show that the venture capital industry embraces value-creating opportunities on the basis of rational partnerships with enterprises that have limited track records and less formal control mechanisms. The tentative factor analysis findings suggest an integrated framework for the venture capital industry from the significant inter-correlations among the variables. The most important focus of this article, however, is its attempt to examine the behavioural traits of SMEs and venture capitalists regarding systematic finance and investment for inclusivity and due diligence.

UNIFEI, Brazil: a case study of the role of the university in local development

The paper analyses the role played by the Universidade Federal de Itajuba, Brazil, in fomenting local development via the establishment and management of technology, traditional and cooperative incubators. Our theoretical basis for this analysis is the Triple Helix theory, which understands economic development as occurring through the transformation of traditional cultural-industrial areas into regional development poles, which are sustained by an alliance between government, university and private enterprise. In a Triple Helix region, universities and other knowledge-generating institutions are linked with investment funds and venture capital organisations to promote development through the interaction of three non-linear fields: knowledge, consensus and innovation.

Indiana Example of Collaboration and Innovation

What do we know about innovation in the social sector that can help policy makers support and take to scale great ideas that make a difference for students? Thanks to a collaboration between government and the private sector, Indiana high schools are being transformed into engaging, project-based learning environments. The launch and scale-up of Indiana's New Tech Network from 2001 to 2010 offer seven key lessons for other states. Lesson #1. Develop a broad vision for change. Key stakeholders in Indiana recognized the critical relationship between education improvement and economic growth. One of the earliest demonstrations of this emerging vision came in 2001 when the University of Indianapolis established the Center for Excellence in Leadership and Learning (CELL), the university's first foray into the K-12 arena, to bring together schools, communities, and businesses in a concerted effort to prepare all Indiana students for success in a global economy. Gov. Mitch Daniels was keenly interested in education reform as an economic growth tool. Rather than mandating change from the top down, the governor and his senior adviser for human capital supported CELL's efforts to identify high school transformation models that would support both education innovation and economic growth. Thus, by the end of 2002, Indiana had established a broad-based vision for a collaborative, public-private approach to education innovation and economic growth. Lesson #2. Anchor the vision to principles. In 2005, Indiana submitted a proposal to the National Governors Association (NGA) to help school corporations develop innovative high school models. As part of the NGA proposal, the state required any school corporation receiving a grant to demonstrate that its proposal was: 1) supported by the entire school community, 2) financially sustainable in the long term, 3) aligned with the community's economic growth strategy, and 4) focused on meeting the requirements of a 21st-century education. These principles, known around the state as nonnegotiables, made clear that participating school communities must own the initiative and that proposals must focus on the critical goals of the effort--to prepare students for the new global economy and to drive economic growth statewide. Lesson #3. Secure public and private financial support. Two important grants laid the groundwork for state and local communities to develop an even broader base of support from the public and private sector. The first was the initial Gates Foundation grant of $11.3 million to develop the Network of Effective Small Schools in Indianapolis (NESSI). The second was a $15 million grant from the Lilly Endowment to establish CELL at the University of Indianapolis. In 2007, NGA awarded Indiana $2 million to help implement new high school models. In that same year, Gates awarded an additional $2.3 million to the Indianapolis Public Schools to continue converting large high schools to small learning communities. Since 2006, the Indianapolis-based Tech-Point Foundation has provided more than $400,000 in financial and in-kind support and leveraged an additional $100,000 from community partners in support of New Tech High @ Arsenal Tech, a low-income, urban school in IPS. Techpoint is a social venture capital organization that supports Indiana organizations focused on helping at-risk youth develop skills for a global, information economy. Finally, in 2010, Lilly provided $20 million to Talent Opportunity Success (TOpS) 2015, an 11-county regional program focused on expanding the talent pipeline to support the growth of high-quality jobs in northeast Indiana. A portion of the funds was designated specifically to launch five STEM-focused New Tech High Schools in northeast Indiana. These schools now represent the largest concentration of New Techs in the country. Lesson #4. …

Reciprocity and interorganizational governance—A multicase analysis of exchange systems

Summary Exchange is regarded as the fundamental activity in every economic context. Seeking a, theoretical conceptualization of interorganizational exchange, we conduct interpretative analysis of, venture capital organizations in Germany and their portfolio companies to develop an exchangerelated, perspective centered on reciprocity in interorganizational relations. We identify two types of, exchange—economic exchange reciprocity and social obligation reciprocity which differ, considerably in their exchange cultures, modes, structures, and resources. The theoretical perspective, might help make the rediscovered concept of reciprocity useful in other organizational and, interorganizational relations.

Finding its Niche: Community Development Venture Capital

Underserved urban and rural areas have found venture capital support via U.S. Community Development Venture Capital institutions, which numbered 68 and managed $870 million as of 2008. Suitable for MBA, undergraduate, and executive learners studying venture capital, urban development, and private equity, this stand-alone backgrounder is also an excellent companion to cases about specific venture capital organizations. CDVCs face challenges unique in the field of private equity, including where they operate and how much lower their rates of return and compensation are.

Specialization and Success: Evidence from Venture Capital

This paper examines how organizational structure affects behavior and outcomes, studying the performance of different types of venture capital organizations. We find a strong positive relationship between the degree of specialization by individual venture capitalists at a firm and its success. When the individual investment professionals are highly specialized themselves, the marginal effect of increasing overall firm specialization is much weaker. The poorer performance by generalists appears to be due to both an inefficient allocation of funding across industries and poor selection of investments within industries. Venture capital organizations with more experience tend to outperform those with less experience.

Reciprocity as Means of Interorganizational Governance – A Multi-Case Analysis of Exchange Systems

Exchange is regarded as the fundamental activity in every economic context. Seeking a theoretical conceptualization of interorganizational exchange, we conduct interpretative analysis of venture capital organizations in Germany and their portfolio companies to develop an exchange-related perspective centered on reciprocity in interorganizational relations. We identify two types of exchange—economic exchange reciprocity and social obligation reciprocity—which differ considerably in their exchange cultures, modes, structures, and resources. The theoretical perspective focuses on making the rediscovered concept of reciprocity useful in other organizational and interorganizational relations.