scholarly journals Assets need audiences: How venture capitalists boost valuations by recruiting investors to asset circles

2021 ◽  
Vol 7 (1) ◽  
pp. 1-19
Author(s):  
Dave Elder-Vass
Keyword(s):  
Venture Capital ◽  
Venture Capitalists ◽  
Financial Assets ◽  
Venture Capital Firm ◽  
Private Companies ◽  
Venture Capital Firms

Narratives and conventions have received considerable attention in recent discussions of the valuation of financial assets. Narratives and conventions, however, can only be effective to the extent that they attract and persuade audiences, and this article makes the case for paying more attention to those audiences. In particular, the article argues that financial assets can only be established as assets if there is a group of potential investors that has been persuaded to accept them as such: to take them seriously as potential investments. The article coins the term asset circles to refer to such groups and supports the argument with a discussion of venture capital and its role in the production of unicorns: private companies with extraordinary valuations. Venture capital firms may be thought of as value entrepreneurs, and much of the venture capital process is oriented towards constructing both value narratives for the companies they invest in and asset circles prepared to accept those value narratives. Their aim in these processes is a profitable exit, in which the venture capital firm converts its investment back into cash at a considerable profit through either an acquisition or a flotation.

Rufus Rivers and Career Choices in Private Equity and Venture Capital Finance

2017 ◽  
pp. 1-21
Author(s):  
Steven Rogers ◽  
Pat Vaccaro ◽  
Scott T. Whitaker
Keyword(s):  
New York ◽  
Venture Capital ◽  
Private Equity ◽  
Career Choices ◽  
The Other ◽  
Venture Capitalists ◽  
Venture Capital Firm ◽  
Executive Search ◽  
Venture Capital Firms

Rufus Rivers, managing director and co-head of mezzanine investing at The Carlyle Group, is reviewing two employment offers he recently received. One came from RLJ Equity Partners, a private equity firm headquartered in the metropolitan Washington, D.C., area. The other came via Glocap Search, a New York-based executive search firm specializing in placing top private equity executives in premier venture capital roles. The Glocap recruiter had told Rivers that he had been selected as the leading candidate for a position with an established Boston-area venture capital firm that had several exciting investment prospects. In the next few days, Rivers needs to consider his personal and professional interests and make a decision: Should he go to Washington, go to Boston, or stay put—and on what terms?Learn about the different kinds of opportunities available to venture capitalists; Assess whether becoming venture capitalists themselves is worthwhile; Learn how venture capital firms offer positions and the terms under which joining a venture capital firm might make sense for them in their careers.

scholarly journals Private equity and venture capital in South Africa: A comparison of project financing decisions

2013 ◽  
Vol 16 (3) ◽  
pp. 258-278 ◽  
Author(s):  
David Portmann ◽  
Chipo Mlambo
Keyword(s):  
South Africa ◽  
Venture Capital ◽  
Private Equity ◽  
Venture Capitalists ◽  
Project Financing ◽  
Financing Decisions ◽  
Start Up ◽  
Risk Appetite ◽  
Investment Opportunities ◽  
Venture Capital Firms

This paper investigates the manner in which private equity and venture capital firms in South Africa assess investment opportunities. The analysis was facilitated using a survey containing both Likert-scale and open-ended questions. The key findings show that both private equity and venture capital firms rate the entrepreneur or management team higher than any other criterion or consideration. Private equity firms, however, emphasise financial criteria more than venture capitalists do. There is also an observable shift in the investment activities away from start-up funding, towards later-stage deals. Risk appetite has also declined post the financial crisis.

Are venture capitalists firefighters? A study of the influence and impact of venture capital firms

Technovation ◽  
1997 ◽  
Vol 17 (9) ◽  
pp. 503-532 ◽  
Author(s):  
Öystein Fredriksen ◽  
Christer Olofsson ◽  
Clas Wahlbin
Keyword(s):  
Venture Capital ◽  
Venture Capitalists ◽  
Venture Capital Firms

scholarly journals Empirical Analysis of Hungarian Firms According to Venture Capital Investment Criteria

2016 ◽  
Vol 9 (1) ◽  
pp. 16-32
Author(s):  
Judit Edit Futó
Keyword(s):  
Venture Capital ◽  
Capital Investment ◽  
Selection Process ◽  
Statistical Tests ◽  
Venture Capitalists ◽  
Venture Capital Investment ◽  
Capital Financing ◽  
Venture Capital Firms ◽  
Investment Process ◽  
Index Investment

Abstract Over the past decade the venture capital industry has become more and more prominent, not just on a global level, but in Hungary, too. Thanks to the JEREMIE Program a large number of new venture capital firms are located in our country, and therefore an investment wave has started. The aim of the paper is to sort micro- and small sized enterprises in terms of how appropriate is a venture capital financing. The main topic of the paper relates to the selection of firms for venture capital investment; therefore, in the first part of the study we briefly summarize a general venture capital investment process, highlighting both the selection process and the criteria used for selection. Then we propose 3 indexes (trustworthiness index, openness index, investment index), which we have created to help venture capitalists to decide whether the targeted enterprises are appropriate for them, or not. In the main part of the paper we provide a classification of micro- and small sized Hungarian firms based on my own survey, and we analyze what kind of relationship exists between the proposed indexes and the type of the classified firms. The result of the classification is that we identify four main firm types and, based on statistical tests, it can be said that there is no significant relationship between the trustworthiness index and the clusters, but that there are between the two other indexes and the clusters.

When do organisations learn from successful experiences? The case of venture capital firms

2019 ◽  
Vol 37 (5) ◽  
pp. 450-472 ◽  
Author(s):  
Violetta Bacon-Gerasymenko
Keyword(s):  
Adverse Effect ◽  
Venture Capital ◽  
Organisational Learning ◽  
Venture Capitalists ◽  
Recent Success ◽  
Future Performance ◽  
Venture Capital Firms ◽  
Practical Implications

This article examines the extent to which venture capital firms (VCFs) learn from successful experience and when such experience influences the likelihood of future successful exits. To test our theory, we drew upon a novel dataset of young French VCFs and their investments. Results indicate that VCFs learn from success, but only up to a certain level of after which the benefits decline. We also found an adverse effect on future performance from the first VCF experience, if it was successful. Refuting our prediction, VCFs appear to learn better from significant, rather than small, successes. Finally, our results reveal that VCFs learn most from more recent success but that extrapolating lessons from more dated experience may harm future performance. Our study contributes to the venture capital and organisational learning literature with practical implications for venture capitalists and entrepreneurs.

What Every Biotech Entrepreneur Needs to Know about VC Due Diligence

2012 ◽  
Vol 18 (2) ◽  
Author(s):  
Stephen M Sammut
Keyword(s):  
Venture Capital ◽  
Business Plan ◽  
Case Law ◽  
Venture Capitalist ◽  
Venture Capitalists ◽  
Due Diligence ◽  
Special Edition ◽  
Venture Capital Firm ◽  
Good Opportunity ◽  
Business Plans

Due diligence, as it applies to venture capital, is actually imprecise. Origins of the term are based in banking case law. Due diligence to the attorney is more of a precise concept. A better term is “homework.” Better indeed, because the burden of this homework weighs far more heavily on the entrepreneur than on the venture capitalist. The odds of getting funded by a venture capital firm are somewhere between 50: and 100: 1. In most instances, the funding goes to companies that already have some connection into the community of venture capital funds. Does this mean that all others need not apply? That is hardly the case. Good venture capitalists know a good opportunity when they see it, but sometimes it is not always obvious. Either the business plan is flawed in strategy, format or content, or the due diligence process reveals a team totally unprepared to fulfill their own vision. Elsewhere in this special edition of JCB is an article on the business plan and the pitch book. This article teaches, in a manner of speaking, how business plans get read and pitches gets heard.

scholarly journals Exploring Israeli Venture Capital Investing In Renewable Energy

2015 ◽  
Vol 4 (1) ◽  
pp. 1-10
Author(s):  
David A. Blum
Keyword(s):  
Renewable Energy ◽  
Venture Capital ◽  
Fossil Fuels ◽  
Research Question ◽  
Venture Capitalists ◽  
Security Risk ◽  
Venture Capital Funding ◽  
Israeli Government ◽  
Capital Funding ◽  
Venture Capital Firms

Israel’s venture capital market is one of the largest in terms of capital investing in the world.  However, in 2014, 5 of 83 independent venture capital firms located in Israel invested in renewable energy portfolio companies. The result of investing in few renewable energy firms in Israel is a continued reliance on imported fossil fuels from geographically distant nations. The importation of fossil fuels creates an added security risk in an already hostile political environment. The gap in research addressed in this paper explored factors for the small number of renewable energy firms receiving venture capital funding in Israel. The research question guiding this study was what are the factors for the small number of renewable energy firms receiving funding in Israel. The lack of renewable energy firm funding appears to be as a result of three factors. First is low return on investment. Second is regulatory uncertainty from the Israeli government. Third is the lack of knowledge of renewable energy by independent venture capitalists. 

scholarly journals Did Venture Capital Promote Innovation in India?

2019 ◽  
Vol 9 (1) ◽  
pp. 2409-2413
Keyword(s):  
Venture Capital ◽  
Relevant Literature ◽  
Secondary Data ◽  
Innovative Technology ◽  
Venture Capitalists ◽  
Capital Investments ◽  
Recent Past ◽  
Indian Context ◽  
Venture Capital Firms ◽  
Venture Capital Investments

The study exhorts to ascertain the general perception that Venture Capitalists fund innovative technology projects in the Indian context using primary and secondary data. A structured questionnaire was used to elicit response from 101 (sample) out of 134 (Population) SEBI registered and active Venture Capital firms in the recent past. The study analyses the mode of funding by Venture Capital firms and their geographical dispersion. The study ascertains whether Venture Capital firms have enabled innovation in the Indian context during the recent past or not. Finally, the study concludes that Venture Capital Investments have not been very enabling for innovative technologies in the Indian context, which is contrary to the relevant literature available in the context of USA and other developed nations.

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