When are venture capital projects initiated?

Research output: Contribution to journalArticle

Abstract

This paper examines how public market information relates to the initiation of venture capital projects. Analysis of venture capital investments in the U.S. between 1980 and 2007 indicates that venture capitalists tend to defer new investment projects in target industries with substantial market volatility. This delay effect of market volatility is reduced if the target industry experiences high sales growth or if competition among venture capitalists is intense in the target industry. The paper provides further evidence to corroborate the view that venture capitalists rationally respond to market shifts in their investment decisions.

Original languageEnglish (US)
Pages (from-to)239-254
Number of pages16
JournalJournal of Business Venturing
Volume26
Issue number2
DOIs
StatePublished - Mar 1 2011

Fingerprint

Industry
Sales
Venture capital
Venture capitalists
Capital projects
Market volatility
Investment project
Investment decision
Sales growth
Market information
Capital investment

Keywords

  • Competition
  • Growth
  • Investment timing
  • Real options
  • Uncertainty
  • Venture capital

ASJC Scopus subject areas

  • Business and International Management
  • Management of Technology and Innovation

Cite this

When are venture capital projects initiated? / Li, Yong; Mahoney, Joseph T.

In: Journal of Business Venturing, Vol. 26, No. 2, 01.03.2011, p. 239-254.

Research output: Contribution to journalArticle

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