Predictors of performance of venture capitalist-backed organizations

Abstract Venture capitalists seek investment opportunities in young, privately-held companies with promising growth prospects. In addition to supplying capital, venture capitalists are decision-making agents who participate in the governance of their ventures and attempt to influence objectives, strategy, structure, and control processes. This study develops and evaluates models examining the impact and relative importance of venture-capitalist factors, managerial strategy, industry structure variables, and their interactions on performance of venture capital-backed organizations. The models are evaluated based on their ability to predict whether the VC-backed venture will provide superior long-term performance.

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