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The inefficiencies of venture capital funding

Author

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  • Welter, Chris
  • Holcomb, Tim R.
  • McIlwraith, John

Abstract

Despite plentiful research into venture capital (VC), the process of obtaining funding still frustrates both VC firms and startups. While uncertainty is necessary for the returns that VC investors desire, there are inefficiencies in the process that stem from information asymmetry. We articulate those inefficiencies from both the founder and the VC perspective and offer some pathways toward reducing those inefficiencies to drive better outcomes for startups, VCs, and society as a whole.

Suggested Citation

  • Welter, Chris & Holcomb, Tim R. & McIlwraith, John, 2023. "The inefficiencies of venture capital funding," Journal of Business Venturing Insights, Elsevier, vol. 19(C).
    • Handle: RePEc:eee:jobuve:v:19:y:2023:i:c:s2352673423000215
    DOI: 10.1016/j.jbvi.2023.e00392
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    References listed on IDEAS

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