Spiky Globalization of Venture Capital Investments: The Influence of Prior Human Networks

Strategic Entrepreneurship Journal, Forthcoming

35 Pages Posted: 11 Feb 2010 Last revised: 6 May 2012

See all articles by Akie Iriyama

Akie Iriyama

SUNY at Buffalo - School of Management

Yong Li

University of Nevada Las Vegas

Ravi Madhavan

University of Pittsburgh

Date Written: February 10, 2010

Abstract

We demonstrate a spiky globalization pattern in the cross-border spread of venture capital: rather than being uniformly distributed, cross-border venture capital flows are unevenly distributed, in that certain regions of the U.S. display particularly intense linkages with certain foreign nations. We posit that such spiky globalization of venture capital is driven by the spiky globalization pattern of prior human networks between locations, and provide empirical results supportive of our hypothesis. Specifically, we reason that immigrant entrepreneurs inherently tend to collocate with each other in their host nation, thus advantaging certain regions in the competition to act as sources and destinations of cross-border venture capital. This study sheds new light on geographical patterns in international venture capital and entrepreneurship.

Keywords: Venture capital, Cross-border capital flows, Immigrant entrepreneurs, Spiky globalization, Human networks, Bilateral intensity index

Suggested Citation

Iriyama, Akie and Li, Yong and Madhavan, Ravindranath, Spiky Globalization of Venture Capital Investments: The Influence of Prior Human Networks (February 10, 2010). Strategic Entrepreneurship Journal, Forthcoming. Available at SSRN: https://ssrn.com/abstract=1550354

Akie Iriyama

SUNY at Buffalo - School of Management ( email )

Jacobs Management Center
Buffalo, NY 14222
United States

Yong Li (Contact Author)

University of Nevada Las Vegas ( email )

4505 S. Maryland Parkway
Las Vegas, NV 89154
United States

Ravindranath Madhavan

University of Pittsburgh ( email )

Katz Graduate School of Business
236 Mervis Hall
Pittsburgh, PA 15260
United States
412-648-1530 (Phone)
412-648-1693 (Fax)

HOME PAGE: http://www.business.pitt.edu/faculty/madhavan.html

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