Venture Capital: A Catalyst for Innovation and Growth
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In this article , the relationship between VC, firm growth, and innovation is investigated, and some stylized facts about VC's impact on innovation and growth are discussed, and empirically evaluated.Abstract:
Venture capital (VC) is a particular type of private equity that focuses on investing in young companies with high-growth potential. The companies and products and services VC helped develop are ubiquitous in our daily lives: the Apple iPhone, Google Search, Amazon, Facebook and Twitter, Starbucks, Uber, Tesla electric vehicles, Airbnb, Instacart, and the Moderna COVID-19 vaccine. Although these companies operate in drastically different industries and with dramatically different business models, they share one common and crucial footprint in their corporate histories: All of them received major financing and mentorship support from VC investors in the early stages of their development. This article outlines the history of VC and characterizes some stylized facts about VC’s impact on innovation and growth. In particular, this article empirically evaluates the relationship between VC, firm growth, and innovation.read more
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The Influence of Venture Capital on Growth through Innovation and the Use of Internet Technology in Micro and Small Industries (MSIs) in Indonesia
TL;DR: In this article , the influence of venture capital on the growth of Micro and Small Industries (MSIs) in Indonesia through innovation and internet technology as the intervening variables was analyzed. And the results showed that venture capital had a direct positive but insignificant influence on growth.
Synergizing Ventures (cid:3)y
TL;DR: In this article , the authors examined both empirically and theoretically the relationship between VC and growth and found that VC-backed startups have higher early growth rates and initial patent quality than non-VC-backed ones.
References
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Financial Dependence and Growth
Raghuram G. Rajan,Raghuram G. Rajan,Raghuram G. Rajan,Luigi Zingales,Luigi Zingales,Luigi Zingales +5 more
TL;DR: This paper examined whether financial development facilitates economic growth by scrutinizing one rationale for such a relationship; that financial development reduces the costs of external finance to firms, and found that industrial sectors that are relatively more in need of foreign finance develop disproportionately faster in countries with more developed financial markets.
Journal ArticleDOI
How Venture Capital Became a Component of the U.S. National System of Innovation
TL;DR: In this paper, the authors trace the history of the VC industry in the U.S. and provide an interesting example of how NSIs can add new institutions and in the process be transformed.
Journal ArticleDOI
Why Doesn't Technology Flow from Rich to Poor Countries?
TL;DR: In this article, a dynamic contract model is embedded into a general equilibrium setting with competitive intermediation, where the terms of finance are dictated by an intermediary's ability to monitor and control a firm's cash flow, in conjunction with the structure of the technology that the firm adopts.
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