Changing the Business Model: Effects of Venture Capital Firms and Outside <scp>CEOs</scp> on Portfolio Company Performance

Gerasymenko, Violetta; Clercq, Dirk De; Sapienza, Harry J.

doi:10.1002/sej.1189

Cited by 69 publications

(68 citation statements)

References 95 publications

(175 reference statements)

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“…Changing the business model: effects of venture capital firms and outside CEOs on portfolio company performance by Gerasymenko, De Clercq, and Sapienza (, this issue), extends the current research on business model change by examining the impact of venture capital firms (VCFs) on the performance of young ventures that have substantially changed their business models. This article focuses on the design and implementation challenges of business models in the context of young ventures.…”

Section: Special Issue Articlesmentioning

confidence: 80%

Introduction to theSEJSpecial Issue on Business Models: Business Models within the Domain of Strategic Entrepreneurship

Demil

Lecocq

Ricart

et al. 2015

Strategic Entrepreneurship

253

222

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International audienceThe study of business models involves exploring how firms do business at the system level. It lies at the intersection of strategy and entrepreneurship research and is, therefore, a topic of interest for scholars of strategic entrepreneurship. The purpose of this special issue is to publish work that develops theory on business models, or empirically investigates the phenomenon, and to inspire future research on the topic. In our introduction, we briefly review the main conceptual developments of the past two decades. We highlight three contributions that business model research is poised to make to the domain of strategic entrepreneurship, and, by extension, to its constituent disciplines of strategy and entrepreneurship: (1) reconnecting strategy with entrepreneurship; (2) suggesting a more central place for customers in our frameworks and analyses; and (3) emphasizing the importance of implementation. We subsequently present the articles in this special issue and explain how they relate to these themes. We conclude with suggestions for future research. Copyright © 2015 Strategic Management Society

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Section: Special Issue Articlesmentioning

confidence: 80%

Introduction to theSEJSpecial Issue on Business Models: Business Models within the Domain of Strategic Entrepreneurship

Demil

Lecocq

Ricart

et al. 2015

Strategic Entrepreneurship

253

222

View full text Add to dashboard Cite

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“…This lack of exit opportunities reduces investments. VC experience is a key determinant of VC success, as the networks, due diligence, and value-added services provided by VCs (such as providing strategic, financial, human resource, and marketing advice, and facilitating connections to customers, suppliers, accountants, lawyers, and investment banks) is substantially higher among experienced VCs (Hege et al, 2009;Nahata, 2008;Ghosh and Nanda, 2010;Bertoni, Colombo, and Grilli, 2011;Cumming and Johan, 2013;Nahata et al, 2014;Gerasymenko, De Clercq, and Sapienza, 2015;Cumming, Henriques, and Sadorsky, 2016a;Cumming, Knill, and Syvrud, 2016b;Tykvova, 2017). Inexperienced VCs are more likely to overinvest in boom periods and invest without the knowledge of prior investment cycles (Gompers & Lerner, 1999), and hence be subjected to problems in subsequent busts (Nahata, 2008; see also Chaplinsky & Gupta-Mukherjee, 2009, Nahata et al, 2014Nielsen, 2008Nielsen, , 2010.…”

Section: Hypothesesmentioning

confidence: 99%

Fintech venture capital

Cumming

Schwienbacher

2018

Corporate Governance

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Manuscript Type Empirical Research Question/Issue Where are fintech venture capital investments taking place around the world? What is the role of institutional factors on the international allocation of fintech venture capital? Research Findings/Insights We document a notable change in the pattern of fintech venture capital (VC) investments around the world relative to other types of investments after the global financial crisis. We show that fintech venture capital investments are relatively more common in countries with weaker regulatory enforcement and without a major financial center after the financial crisis. Also, we show the fintech boom is more pronounced for smaller private limited partnership venture capitalists that likely have less experience with prior venture capital booms and busts. These fintech VC deals are substantially more likely to be liquidated, especially when located in countries without a major financial center. Theoretical/Academic Implications We build on the institutions and corporate governance literatures by showing the importance of enforcement in driving relative differences in investment patterns and investor participation. For entrepreneurial startups, regulatory arbitrage drives investment into countries with a dearth of enforcement and regulatory costs. We argue that the spike in fintech venture capital in certain countries is attributable to differential enforcement of financial institution rules amongst startups versus large established financial institutions after the financial crisis. Practitioner/Policy Implications Regulatory arbitrage in the context of fintech venture capital can spur booms and busts. Less experienced venture capitalists seem more prone to undertake investments that exacerbate boom and bust cycles. National governance is strengthened by the enforcement of regulatory standards, and corporate governance through investor experience and oversight can mitigate these swings, and facilitate better investment outcomes.

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“…On Google Scholar in September 2016, we typed (with quotes for a more restrictive search) "venture capital decision" and up came more than 1,000 papers, virtually all of which are published in management and entrepreneurship journals. Some of these papers have more than 1,000 citations on Google Scholar, and many have titles that are extremely similar to the study, with the words "venture capital" and "decision" in the title (e.g., Dushnitsky & Lavie, 2010;Gerasymenko, De Clercq, & Sapienza, 2015;Hill, Maula, Birkinshaw, & Murray, 2009;Iriyama, Li, & Madhavan, 2010;Wuebker, Hampl, & Wüstenhagen, 2015; see also Manigart et al, 2002;Sapienza, Manigart, & Vermeir, 1996;Wright et al, 2004;Wright, Pruthi, & Lockett, 2005). Also, work on venture capital and private equity performance tends to be segmented by the use of particular data, with datasets such as those from Thomson being publishable and acknowledged in finance work (e.g., Nahata, 2008), but data from CEPRES Cumming, Schmidt, & Walz, 2010), CMBOR, Pitchbook (Johan & Zhang, 2014), and VICO (Bertoni, Colombo, & Grilli, 2011) being less often recognized in finance journals (although there are some exceptions, such as Franzoni, Nowak, & Phalippou (2012) with CEPRES data, Johan and Zhang (2016) with Pitchbook data, and Nikoskelainen and Wright (2007) with CMBOR data).…”

Section: A Backgrounder On Interpreting Citation Data In Entrepreneurmentioning

confidence: 99%

The Problems with and Promise of Entrepreneurial Finance

Cumming

Johan²

2017

Strat. Entrepreneurship J.

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Research summary This article provides a review of the entrepreneurial finance literature in the surprisingly not very well integrated entrepreneurship and finance journals. Entrepreneurial finance encompasses venture capital, private equity, private debt, trade credit, IPOs, angel finance, and crowdfunding, among other forms of finance. We analyze trends in citation activity to these topic areas across 16 journals that publish at least somewhat regularly on these topics, and we show there has been a rise in citations on venture capital, private equity, and IPOs post‐2006. We highlight an unfortunate degree of segmentation in the literature, as well as topics that have been the subject of scholarly focus, and identify promising topics for future research. Managerial summary Who does research in entrepreneurial finance—entrepreneurship or finance scholars? And which types of journals are more likely to publish research in entrepreneurial finance? In this article, we provide an overview of the literature on topics that include venture capital, private equity, private debt, trade credit, IPOs, angel finance, and crowdfunding. Our review of the literature shows some elements of segmentation by the specific topic, which we explain is partly due to the fact that datasets on entrepreneurial finance themselves are often segmented and do not include information on more than one form of entrepreneurial finance at a time. Further, we show citation patterns are segmented by the type of journal, with finance journals being much less likely to refer to entrepreneurship journals. Copyright © 2017 Strategic Management Society

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Changing the Business Model: Effects of Venture Capital Firms and Outside CEOs on Portfolio Company Performance

Cited by 69 publications

References 95 publications

Introduction to theSEJSpecial Issue on Business Models: Business Models within the Domain of Strategic Entrepreneurship

Introduction to theSEJSpecial Issue on Business Models: Business Models within the Domain of Strategic Entrepreneurship

Fintech venture capital

The Problems with and Promise of Entrepreneurial Finance

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