The Optimal Portfolio of Start-Up Firms in Venture Capital Finance

A venture capitalist faces a trade-off between the extent of managerial advice allocated to each start-up and the total number of firms advised. Diminishing returns to advice per firm call for a larger portfolio. As advice gets diluted, further expansion of the portfolio eventually becomes unprofitable.

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Year of publication:	2000
Authors:	Kanniainen, Vesa ; Keuschnigg, Christian
Institutions:	CESifo
Subject:	Venture capital finance \| double-sided moral hazard \| company portfolio

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Extent:	application/pdf
Series:	CESifo Working Paper Series.
Type of publication:	Book / Working Paper
Language:	English
Notes:	Number 381
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005416459