Financing High-Tech Growth: The Role of Banks and Venture Capitalists
David B. Audretsch
Indiana University - Institute for Development Strategies; King Saud University; WHU - Otto Beisheim School of Management; Indiana University Bloomington - School of Public & Environmental Affairs (SPEA)
Erik E. Lehmann
University of Augsburg - Faculty of Business and Economics
Schmalenbach Business Review, Vol. 56, October 2004
Using a data set of the firms listed on the Neuer Markt in Germany, we demonstrate that venture-backed firms differ from firms with other financial resources, especially debt. Thus, the results of this study support the hypothesis that small and innovative firms are more likely to be financed by venture capitalists rather than banks. We also provide evidence that the presence of venture capitalists enhance the growth rates of firms positively.
Number of Pages in PDF File: 19
Keywords: Venture capital, new economy, entrepreneurship, corporate governance
JEL Classification: G32, L11, M13
Date posted: December 11, 2004
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