The Attractiveness of Central Eastern European Countries for Venture Capital and Private Equity Investors

39 Pages Posted: 19 Mar 2008 Last revised: 7 Sep 2008

See all articles by Alexander Peter Groh

Alexander Peter Groh

EMLYON Business School

Heinrich Liechtenstein

University of Navarra - IESE Business School

Karsten Lieser

Allianz Real Estate

Date Written: March 2008

Abstract

We address the attractiveness of Central Eastern European countries for VC/PE investors by the construction of a composite index. For the index's composition we refer to the results of numerous prior research papers that investigate relevant parameters determining entrepreneurial activity and/or the engagements of institutional investors. We aggregate the index via five different methods and receive country rankings that vary only slightly, signaling a robust index calculation. We clearly identify six tier groups of attractiveness for all of our sample countries. We compare our index with the actual fundraising activities in the individual countries and reveal a reasonable correlation of both figures. The results highlight the strengths and weaknesses of the particular economies and provide guidelines for policy improvements and institutional investors' country allocations.

Keywords: Venture Capital, Private Equity, Central Eastern Europe, Economic Transition

JEL Classification: G23, G24, M13, O16, P34, P52

Suggested Citation

Groh, Alexander Peter and Liechtenstein, Heinrich and Lieser, Karsten, The Attractiveness of Central Eastern European Countries for Venture Capital and Private Equity Investors (March 2008). IESE Business School Working Paper No. D/677; EFA 2008 Athens Meetings Paper. Available at SSRN: https://ssrn.com/abstract=960505 or http://dx.doi.org/10.2139/ssrn.960505

Alexander Peter Groh (Contact Author)

EMLYON Business School ( email )

23 Avenue Guy de Collongue
Ecully, 69132
France

Heinrich Liechtenstein

University of Navarra - IESE Business School ( email )

Avenida Pearson 21
Barcelona, 08034
Spain

Karsten Lieser

Allianz Real Estate ( email )

Germany

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