We study how a new development in entrepreneurship—crowdfunding—interacts with more traditional financing sources, such as venture capital (VC) and bank financing. …Read More
Does Crowdfunding Benefit Entrepreneurs and Venture Capital Investors?
venture capital
Does Private Equity Ownership Make Firms Cleaner? The Role Of Environmental Liability Risks
As VC firms have an acute interest in high-tech companies, they potentially bear substantial risk of patent litigation. In this project, we aim at looking into the following questions: how do ex-ante and ex-post patent litigation risks affect VC firms’ investment strategies and how those risks is propagated among all portfolio companies they have invested?…Read More
Entrepreneur David Kidder Says Loving Your Idea Is the Wrong Business Obsession
The CEO and co-founder of Bionic and author of “New to Big” and “The Startup Playbook” explained his model for enterprise growth.…Read More
Volatility and Venture Capital
The performance of venture capital (VC) investments load positively on shocks to aggregate return volatility. I document this novel source of risk at the asset-class, fund, and portfolio-company levels. The positive relation between VC performance and volatility is driven by the option-like structure of VC investments, especially by VCs’ contractual option to reinvest.…Read More
Organizational Decision-Making and Information: Angel Investments by Venture Capital Partners
We study information aggregation in organizational decision-making for the financing of entrepreneurial ventures. We introduce a formal model of voting where agents face costly tacit information to improve their decision quality.…Read More
Social Is the New Financial: How Startup Social Media Activity Influences Funding Outcomes
In this project, we explore the impact of startup firms’ social media activities on their entrepreneurial financing performance. Social media can mitigate information problems in entrepreneurial financing in two ways.…Read More
When Crowdfunding Crowds Out the Competition
Crowdfunding platforms such as Kickstarter have been popular in the U.S. for several years, allowing everyday consumers to fund entrepreneurial ventures in return for the finished product. While such “reward-based” crowdfunding can open many doors for entrepreneurs, could it also close others?…Read More
Industry and Academic Perspectives on VC Investment Strategy
The gap between business research and industry practice can loom large at times, but bridging it is essential to ensuring that research is relevant to the outside world. For graduate students at the Wharton School, the Mack Innovation Doctoral Association intends to narrow that gap.…Read More
Network Formation in Financial Intermediation: Venture Capital Co-Investment Networks
Venture capitalists often choose to form syndicates (groups of VCs) which jointly invest in projects instead of one VC funding the project individually. What are the determinants of who chooses to syndicate with whom?…Read More
Corporate VCs Yield Better Innovation Outcomes
Recent research by Senior Fellow Gary Dushnitsky measures the innovation success of new biotech ventures by tracking their patenting and publishing rates. He and coauthor Elisa Alvarez-Garrido find that the identity of the investor makes a big difference.…Read More
In the VC World, Collective Wisdom Isn’t Always So Wise
New research indicates that individuals’ investment decisions may outperform those of the group. How can firms make better decisions?…Read More
The Bright Side of the Biotech Funding Bust
Biotech start-ups are a critical source of life-saving discoveries. What happens when VCs won’t fund them?…Read More
Are Entrepreneurial Ventures’ Innovation Rates Sensitive to Investor Complementary Assets?
Entrepreneurial ventures are a key source of innovation. Nowadays, ventures are backed by a wide array of investors whose complementary asset profiles differ significantly. We therefore assert that entrepreneurial ventures can no longer be studied as a homogeneous group.…Read More
Hybrid Vigor: Securing Venture Capital by Spanning Categories in Nanotechnology
This study develops and tests a set of novel theoretical predictions about the conditions under which category spanning is rewarded by external audiences. To do this, we revisit the assumption that comprehensible organizational identities are associated with individual categories.…Read More
Publications and Patents in Corporate Venture-Backed Biotech
Biotech startups increasingly turn to corporate venture capital (VC) arms for funding, rather than to traditional venture capitalists. The innovation implications for these startups remain unexplored. Here, we present evidence that the shift in funding patterns is associated with a greater output of scientific publications as well as patenting.…Read More
Acqui-Hires: Revolutionizing Strategy & Transforming Organizational Structures
This paper explores the phenomenon of “acqui-hires”, defined as acquisitions of early-stage startups made purely to acquire talent. Acqui-hires are prevalent among Northern California’s high-technology companies, who use these to fill gaps in their strategic roadmaps. Taking the perspective of an acquirer, we examine the different ways acquirers approach acquir-hires relative to conventional acquisitions.…Read More
Institutions and the Internationalization of U.S. Venture Capital Firms
In recent years, venture capital firms have increasingly turned to foreign countries in search of investment opportunities. The cross-border expansion of venture capital firms presents an interesting case of internationalization, because they are at variance with both conventional portfolio and direct investment models.…Read More