Venture Capital →
- 10 Feb 2017
- Working Paper Summaries
The Persistent Effect of Initial Success: Evidence from Venture Capital
To understand better what channels might account for persistence in the fund-level performance of private equity firms, the authors examine the individual investments underlying fund-level returns.
- 23 Sep 2016
- Working Paper Summaries
How Do Venture Capitalists Make Decisions?
This study surveys 885 institutional VCs at 681 firms asking how they make decisions across eight areas: deal sourcing; investment selection; valuation; deal structure; post-investment value-added; exits; internal VC firm issues; and external VC firm issues.
- 17 Aug 2016
- Working Paper Summaries
Venture Capital Data: Opportunities and Challenges
Venture capital is a relatively small financial institution receiving a large amount of theoretical, empirical, policy, and media interest—perhaps because venture capital encompasses the extremes of corporate finance challenges: uncertainty, information asymmetry, and asset intangibility—and yet has been successful at growing many leading companies. This paper looks at the availability of information about venture capital. While it is it is difficult to paint in definitive terms the level of investment activity and fund performance, the quality of information available has increased in recent years and will likely continue to do so going forward.
- 21 Jul 2016
- Cold Call Podcast
How Small Investors Can Bet Big on Brands They Love
LOYAL3 allows consumers to make small stock purchases of companies they love. In this Cold Call podcast, Luis M. Viceira discusses LOYAL3's move into IPOs and the idea that shareholders make better customers. Open for comment; 0 Comments.
- 18 Jul 2016
- Research & Ideas
Is Greed Ruining Private Equity Firms?
In a first-ever look at the internal economics driving private equity partnerships, Victoria Ivashina and Josh Lerner find that founding partners who take an unequal share of the pie can ruin their firms. Open for comment; 0 Comments.
- 15 Jun 2016
- Research & Ideas
These VC Partners May Make Your Firm Less Innovative
Startups that do business with VCs that also fund competitors may find they get the short end of the attention stick and produce fewer new products, concludes research by Rory McDonald and colleagues. Open for comment; 0 Comments.
- 03 May 2016
- Working Paper Summaries
Pay Now or Pay Later? The Economics within the Private Equity Partnership
Partnerships are essential to the professional service and investment sectors. Yet the partnership structure raises issues including intergenerational continuity. This study of more than 700 private equity partnerships finds 1) the allocation of fund economics is typically weighted toward the founders of the firms, 2) the distributions of carried interest and ownership substantially affect the stability of the partnership, and 3) partners’ departures have a negative effect on private equity groups’ ability to raise additional funds.
- 06 Apr 2016
- Research & Ideas
Should Entrepreneurs Pitch Products or Ideas for Products?
Entrepreneurs with a new product idea must decide whether to pitch the concept or provide an actual prototype. Which works best? Professor Hong Luo finds answers in Hollywood screenplays. Open for comment; 0 Comments.
- 21 Jan 2016
- Working Paper Summaries
The Globalization of Angel Investments: Evidence across Countries
Examining a cross-section of 13 angel groups who considered transactions across 21 countries, this study finds that angel investors have a positive impact on the growth of the firms they fund, their performance, and survival, while the selection of firms that apply for angel funding varies across countries.
- 07 Dec 2015
- Research & Ideas
The Rise of Personalized Entrepreneurial Finance and Other VC Trends
Thanks to tools such as Kickstarter, venture capital is becoming more democratized. Josh Lerner discusses crowd funding, investment trends, and other features of the changing funding landscape. Open for comment; 0 Comments.
- 21 Oct 2015
- Research & Ideas
How to Predict if a New Business Idea is Any Good
Professor Pian Shu tackles one of the most difficult questions in the startup world: How can you tell if a new business will succeed? Open for comment; 0 Comments.
- 23 Jun 2014
- Research & Ideas
In Venture Capital, Birds of a Feather Lose Money Together
The more affinity there is between two VCs investing in a firm, the less likely the firm will succeed, according to research by Paul Gompers, Yuhai Xuan and Vladimir Mukharlyamov. Closed for comment; 0 Comments.
- 30 Apr 2014
- Research & Ideas
Venture Investors Prefer Funding Handsome Men
Studies by Alison Wood Brooks and colleagues reveal that investors prefer pitches from male entrepreneurs over those from female entrepreneurs, even when the content of the pitches is identical. And handsome men fare best of all. Open for comment; 0 Comments.
- 26 Aug 2013
- Lessons from the Classroom
Built for Global Competition from the Start
Building a startup as a global business requires managers with skills and strategy much different from their predecessors of even a generation ago, says William R. Kerr. Closed for comment; 0 Comments.
- 01 Jul 2013
- Research & Ideas
Crowdfunding a Poor Investment?
Crowdfunding promises to democratize funding of startups. But is that necessarily a good thing? Entrepreneurial finance experts Josh Lerner, Ramana Nanda, and Michael J. Roberts on the promises and problems with the newest method for funding small businesses. Closed for comment; 0 Comments.
- 18 Feb 2013
- Research & Ideas
Breaking Through a Growth Stall
Many companies get stuck on a plateau, unable to grow and burning through cash at a frightening rate. Frank V. Cespedes discusses how focusing on the right customers can generate growth again. Closed for comment; 0 Comments.
- 19 Sep 2012
- Research & Ideas
Funding Innovation: Is Your Firm Doing it Wrong?
Many companies are at a loss about how to fund innovation successfully. In his new book, The Architecture of Innovation, Professor Josh Lerner starts with this advice: get the incentives right. Open for comment; 0 Comments.
- 04 Apr 2012
- Research & Ideas
When Founders Recruit Friends and Family as Investors
In his new book, The Founder's Dilemmas: Anticipating and Avoiding the Pitfalls That Can Sink a Startup, HBS Associate Professor Noam Wasserman tells readers how to anticipate, avoid, and, if necessary, recover from the landmines that can destroy a nascent company before it has the chance to thrive. In this excerpt, he discusses the pros and cons of recruiting friends and family members as investors. Open for comment; 0 Comments.
- 18 Oct 2010
- Lessons from the Classroom
Venture Capital’s Disconnect with Clean Tech
Clean-tech start-ups depend on patience and public policy to thrive—the Internet models for VC funding don't apply. That's why Harvard Business School professor Joseph Lassiter is making an unusual recommendation to his entrepreneurship students: Spend a few years serving time in a government job. Key concepts include: MBA students and young venture capitalists often assume that all promising start-ups can grow and exit as fast as Internet start-ups, but they're mistaken. Clean-tech start-ups are often stymied by a "valley of death"—that precarious stage between researching and developing a product and going to market. The success of clean-tech companies often is dependent on public policy, so it behooves budding VCs and entrepreneurs to spend a few years learning the ropes in a government or corporate job. Closed for comment; 0 Comments.
Diversity in Innovation
This study discusses a systematic and persistent lack of female, Hispanic, and African American labor market participation in the innovation sector, through both entrepreneurs and the venture capitalists that fund them.