How the Strategic Choices of Their Management Company Affect the Returns on French Venture Capital Funds
28 Pages Posted: 19 May 2015
Date Written: November 3, 2014
We study performance factors for French venture capital (VC) funds, focusing on the strategies conducted by VC firms concerning specialization, ownership status, fund focus, fund size, and minimum subscription. We use the crash of technology stocks in March 2000 to show that two groups of VC firms (winners and losers) adopt differentiated strategies in contrasting competitive situations (before and after the crash). To solve the problem of the clustering of VC funds within firms, we use a methodology of multilevel models to test our hypotheses.
Keywords: Venture capital, performance, strategy, multilevel model
JEL Classification: G32, L14, L25
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