Allocation of Attention to Portfolio Companies and the Performance of Venture Capital Firms
Helsinki University of Technology - Institute of Strategy
Markku V. J. Maula
Aalto University, Dept. of Industrial Engineering and Management, Institute of Strategy
Boston Consulting Group
Entrepreneurship Theory and Practice, Vol. 30, No. 2, pp. 18-206
This article proposes that the attention allocated by venture capitalists to portfolio companies impacts their performance. The article develops arguments for optimal portfolio size and for the moderating roles of syndication frequency and role. The hypotheses receive support from analyses employing longitudinal data of the leading U.S. venture capital firms. Our results indicate the value of venture capitalist involvement and give guidance for its optimal allocation and syndication.
Keywords: Venture capital, portfolio, allocation of attention, performance
JEL Classification: G24, M13Accepted Paper Series
Date posted: August 22, 2008
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