Profitability of venture capital investment in Europe and the United States
AbstractThis paper examines the profitability of venture capital investment in Europe and the United States. It highlights the unfavourable profitability differential of European venture capital investment in comparison with the United States. The investment performance measures used are the internal rate of return (IRR) and investment multiples. The analysis covers aggregated industry returns and venture capital funds' returns aggregated by vintage year. It relies on the VentureXpert private equity and venture capital performance database, maintained by Thomson Venture Economics. It also considers developments in the private equity and venture capital markets in Europe and the United States.
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Bibliographic InfoPaper provided by Directorate General Economic and Monetary Affairs (DG ECFIN), European Commission in its series European Economy - Economic Papers with number 245.
Length: 27 pages
Date of creation: Mar 2006
Date of revision:
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venture capital; profitability; performance; IRR; capital investment; Dantas Machado Rosa; Raade;
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- Bottazzi, L. & Da Rin, M. & Hellmann, T., 2004. "The changing face of the European venture capital industry: Facts and analysis," Open Access publications from Tilburg University urn:nbn:nl:ui:12-3106559, Tilburg University.
- Chemla, Gilles, 2004. "Pension Fund Investment in Private Equity and Venture Capital in the U.S. and Canada," Economics Papers from University Paris Dauphine 123456789/6431, Paris Dauphine University.
- Alexander Ljungqvist & Matthew Richardson, 2003. "The cash flow, return and risk characteristics of private equity," NBER Working Papers 9454, National Bureau of Economic Research, Inc.
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