Financial Intermediaries, Ownership Structure and the Provision of Venture Capital to Smes: Evidence from Japan

46 Pages Posted: 19 Jul 2005 Last revised: 11 Sep 2008

See all articles by Douglas J. Cumming

Douglas J. Cumming

Florida Atlantic University

Armin Schwienbacher

SKEMA Business School

Grant Fleming

Continuity Capital Partners

Date Written: May 3, 2005


This paper examines how the provision of venture capital to small and medium sized businesses (SMEs) is influenced by the ownership structure of the venture capital provider. We introduce a new and unique dataset from the Japanese venture capital market, comprising data on investment and venture capital activities of 127 Japanese venture capital funds. The data allows us to provide a direct comparison of the behaviour of individual owner-manager venture capitalists versus financial intermediation (e.g. bank's venture capital divisions). The data indicate owner-manager venture capitalists (financial disintermediation) give rise to much smaller portfolios of SMEs and more advice to entrepreneurs. Across the scope of different financial intermediation structures including banks, life insurance companies, securities firms, corporations and government bodies, there are further differences in the provision of governance and value-added advice provided to SMEs. Also, the data indicate US-affiliated funds in Japan are more likely to have smaller portfolios and tend to provide more advice to SMEs.

Keywords: Financial Intermediation, Ownership Structure, Private Equity

JEL Classification: G24, G28, G31, G32, G35

Suggested Citation

Cumming, Douglas J. and Schwienbacher, Armin and Fleming, Grant Alan, Financial Intermediaries, Ownership Structure and the Provision of Venture Capital to Smes: Evidence from Japan (May 3, 2005). Small Business Economics, Vol. 31, pp. 59-92, 2008, Available at SSRN: or

Douglas J. Cumming (Contact Author)

Florida Atlantic University ( email )

777 Glades Rd
Boca Raton, FL 33431
United States


Armin Schwienbacher

SKEMA Business School ( email )

Avenue Willy Brandt
Euralille, 59777


Grant Alan Fleming

Continuity Capital Partners ( email )

GPO Box 314
Canberra, Australian Capital Territory 2601

Here is the Coronavirus
related research on SSRN

Paper statistics

Abstract Views
PlumX Metrics