Venture capital markets are characterized by multiple incentive problems and asymmetric information in an uncertain environment. All kinds of agency problems are present: moral hazard, adverse selection, hold-up problems, window dressing, etc. Entrepreneurs and venture capitalists enter into...

The inventive process is the most important driver of economic growth. Venture capital (VC) funds have contributed a small, but critical, part to the inventive process. VC funds boost the inventive process by selecting a small number of radical ideas out a large flow of ideas and invest in their...

Aufgrund der geringen Eigenkapitalausstattung junger, innovativer und schnell wachsender Unternehmen und erheblicher Unsicherheiten hinsichtlich des Erfolgs der geplanten Investitionen scheidet eine Finanzierung mittels Fremdkapital oftmals aus oder erfolgt nicht in dem Umfang, den die...

This paper investigates how patent applications and grants held by new ventures improve their ability to attract venture capital (VC) financing. We argue that investors are faced with considerable uncertainty and therefore rely on patents as signals when trying to assess the prospects of...

The change in the business model of venture capitalists from investing locally towards investing across borders started to intensify in the late 1990s. According to a dataset of European and North-American countries, we find that countries with higher expected growth and higher lagged stock...

This study examines the consequences of loan denials for the investment performance of small and medium-sized German enterprises. As a consequence of a loan denial, innovative companies experience a smaller drop in the share of actual to planned investment than non-innovative companies. The...