Economic Geography, Venture Capital and Focal Points of Entrepreneurial Activity
20 Pages Posted: 24 Aug 2009
Date Written: August 24, 2009
Economic geography receives limited consideration in the venture capital literature. This study utilizes thirty years of data concerning companies that initially were backed by venture capital. These firms are located in Entrepreneurial Focal Points in the United States, namely: California, Massachusetts, New York, Pennsylvania and Texas. How well do these companies operate once they go public? Do the scrutiny measures, expertise and financial backing that firms gain from the venture capitalists increase their annual and cumulative returns? The results show that returns on investment are adequate given their substantial risk.
Keywords: Annualized and cumulative returns, Venture Capital, Venture-Backed Public Companies, Active and Inactive firms, Pennsylvania, Massachusetts, California, Texas, New York
JEL Classification: C12, D81, D92, E22, G12, G24, G3, M13, M21, O16, O3
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