This study examines the relevance of financial and non-financial information for the valuation of venture capital (VC) investments. Based on a hand-collected data set on venture-backed start-ups in Germany, we investigate the internal due diligence documents of over 200 investment rounds. We...

This study provides evidence of significant biases in multi-year management forecasts by analyzing a proprietary dataset on venture-backed start-ups in Germany. We find that revenues and expenses are highly overestimated in each of the investigated one- to five-year-ahead planning periods....

This study shows how venture capital investors can identify potential biases in multi-year management forecasts before an investment decision and derive significantly more accurate failure predictions. By advancing a cross-sectional projection method developed by prior research and using...

This study examines the relevance of financial and non-financial information for the valuation of venture-capital investments. Based on a hand-collected dataset on venture-backed start-ups in Germany, we investigate the internal due diligence documents of over 200 investment rounds. We document...