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The effect of venture capitalists straying from their industry comfort zones

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  • Hull, Tyler J.

Abstract

I empirically test and find evidence that venture capital industry experience is more informative and impactful in venture capital investment when measured at the low non-aggregated industry level. Additional evidence shows that venture capital investments made outside of a venture capitalist's preferred investment industry suffer from significant decreases in exit success likelihood. This effect becomes stronger the more distant the investment industry is from the venture capitalist's preferred investment industry.

Suggested Citation

  • Hull, Tyler J., 2021. "The effect of venture capitalists straying from their industry comfort zones," Journal of Business Venturing Insights, Elsevier, vol. 16(C).
    • Handle: RePEc:eee:jobuve:v:16:y:2021:i:c:s2352673421000445
    DOI: 10.1016/j.jbvi.2021.e00266
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    2. Bugl, Benjamin M. & Balz, Frank P. & Kanbach, Dominik K., 2022. "Leveraging smart capital through corporate venture capital: A typology of value creation for new venture firms," Journal of Business Venturing Insights, Elsevier, vol. 17(C).
    3. Köppl-Turyna, Monika & Köppl, Stefan & Christopulos, Dimitris, 2023. "How to support cleantech start-ups? Lessons from European venture-capital deals," Research Papers 25, EcoAustria – Institute for Economic Research.

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