The role of corporate venture capital on returns to acquiring firms: evidence from the biotechnology industry

2021 ◽  
pp. 1-17
Author(s):  
Jay J Janney ◽  
Naga Lakshmi Damaraju ◽  
Gregory G. Dess
Keyword(s):  
Venture Capital ◽  
Biotechnology Industry ◽  
Corporate Venture Capital ◽  
Acquiring Firms ◽  
Corporate Venture

scholarly journals Partnership versus corporation: untangling the governance dilemma of corporate venture capital

2008 ◽  
Vol 6 (1-2) ◽  
pp. 263-267
Author(s):  
Gianfranco Gianfrate ◽  
Laura Zanetti
Keyword(s):  
Venture Capital ◽  
Research Note ◽  
Capital Investments ◽  
Corporate Venture Capital ◽  
Financial Returns ◽  
Corporate Venture ◽  
Venture Capital Investments

This brief research note discusses the role of organizational and governance design in a specific sector, namely the Corporate Venture Capital (CVC). This specific segment of the venture capital industry has so far proved to be at least as successful as venture capital investments carried out by “independent” or “pure” players, but corporate-sponsored initiatives tend to be more short-lived, cyclical and unstable. Unlike traditional venture capital funds, CVC established by corporations usually seek both financial returns and “strategic” benefits. We discuss the dilemma faced by corporations setting-up CVC programs in terms of governance design and ownership arrangements, showing that strategic and financial performances are unlikely to be conjointly maximized, thus leading to the inherent instability of such programs.

A Start-Up’s R&D Stages and the Evolution of Financing Sources: Evidence from the Biotechnology Industry

2018 ◽  
Vol 8 (3) ◽  
Author(s):  
Hyunsung D Kang
Keyword(s):  
Life Cycle ◽  
Venture Capital ◽  
Biotechnology Industry ◽  
Phase Iii ◽  
Corporate Venture Capital ◽  
Entrepreneurial Finance ◽  
Life Cycle Theory ◽  
Start Up ◽  
Corporate Venture ◽  
Start Ups

AbstractThe co-existence of angel, independent venture capital (IVC), and corporate venture capital (CVC) in the entrepreneurial finance market raises a natural question of why a start-up finances its projects from one source over another. This question becomes more complicated to address because a start-up grows or declines dynamically. Using a life cycle theory of entrepreneurial finance, which suggests that a start-up uses several financing sources as it reaches certain thresholds in its life cycle accordingly, I explore this selection issue with my dataset on 113 biopharmaceutical start-ups. I find that these start-ups tend to finance their projects mostly from solely IVCs or CVCs rather than angels and syndicated investors combining IVCs and CVCs when they have more preclinical and phase I products in their R&D pipelines; and from CVCs or syndicated investors rather than angels and IVCs when they do more phase II and phase III products.

scholarly journals Moderating Factors in Distant Investment of Corporate Venture Capital

2019 ◽  
Vol 5 (1) ◽  
pp. 19 ◽  
Author(s):  
Shinhyung Kang ◽  
JungTae Hwang
Keyword(s):  
Venture Capital ◽  
Target Selection ◽  
Corporate Venture Capital ◽  
Information Cost ◽  
Business Units ◽  
Moderating Factors ◽  
Corporate Venture ◽  
Venture Capital Firms ◽  
Selection Of

The role of venture capital as mediator and gatekeeper is well acknowledged and geographical barriers for open innovation have been questioned, but venture capital firms’ distant investments have been investigated only rarely. The strategic benefits accrued from corporate venture capital (CVC) investment depend on the selection of target ventures. Prior research, however, overlooked the incurred information cost for identifying a potential target. Considering that innovative ventures often reside in distant locations, this paper aims to investigate what factors alleviate the information cost for CVCs when identifying target ventures in distant locations. We expect a CVC’s target selection in distant locations will be limited to the ventures under a tight appropriability regime, ventures within the same industries as a CVC’s business units, and ventures with pre-existing investors that a CVC has prior ties with. The hypotheses are tested with the data on CVC investments in the U.S. between 2006 and 2013. The results empirically support the hypotheses.

Corporate venture capital: The role of governance factors

2016 ◽  
Vol 69 (11) ◽  
pp. 4744-4749 ◽  
Author(s):  
Sergey Anokhin ◽  
Simon Peck ◽  
Joakim Wincent
Keyword(s):  
Venture Capital ◽  
Corporate Venture Capital ◽  
Corporate Venture
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