Are Venture Capitalists a Catalyst for Innovation?

Abstract

"In this paper we test two hypotheses concerning the presence of innovation in venture capital investments and the growth of innovative venture backed firms. To examine these hypotheses we considered sample of 37 Italian venture backed firms that went public on the Italian Stock Exchange between 1995 and 2004 and by a statistical matching procedure we picked 37 twin firms among the non-venture backed IPOs for the same period. Our evidence shows that innovation is an important factor during the selection phase but once the investment is made, the company does not promote continued innovation and concentrates all efforts to improve other economic and managerial aspects". Copyright (c) 2008 The Authors Journal compilation (c) 2008 Blackwell Publishing Ltd.

Explaining Venture Capital And Technology Commercialization In Eu Countries Through Dynamic Modeling

“…In terms of GMM-SYS estimation for patents, we find a negative and statistically significant relationship for both VC investment and number of VC companies. Moreover, a negative relation between VC and patents is in line with the results of Caselli, Gatti, and Perrini (2009). Column III and IV are focused on the impact of VC on start-ups.…”

Access to Finance: Impacts of Publicly Supported Venture Capital and Loan Guarantees

“…Kortum and Lerner (2000) present a venture capital first account; that is, the presence of venture capital leads to firms innovating. But various other studies (Engel and Keilbach 2007;Hirukawa and Ueda 2008;Caselli et al 2009;Lahr and Mina 2012;Popov and Roosenboom 2012), all support the hypothesis that venture capital does not foster new innovations but instead invests in already innovative firms. Nevertheless while the direction of causation is yet to be determined, there is still a strong association between venture capital and innovation.…”

The Impact of Venture Capital on the Persistence of Innovation Activities of Swiss Start-Ups

“…Based on data for Italian IPOs, Caselli et al (2009) find that funded companies even have registered fewer patents than non-funded firms in the period after funding. The study of Engel and Keilbach (2007) is based on German start-up data.…”