IDEAS home Printed from https://ideas.repec.org/a/ids/gbusec/v29y2023i1p1-15.html
   My bibliography  Save this article

Determinants of security design in venture capital investment: a study on Indian start-ups

Author

Listed:
  • Sarita Mishra
  • Suresh Kumar Sahoo

Abstract

An imperfect competitive financial market has a few underlying problems such as an adverse selection and information asymmetry problem which is the same in the case of a venture capital (VC) investment deal. In these contexts, VC investors design their mode of financing to minimise the effect of the above issues. This study considers various contributing factors for selection decision of security design in different venture capital deal. In this regard, various venture capital method of investment in an entrepreneurial firm has been included in this study. Three categories of factors affect security choice by VC investors to invest in India: 1) firm characteristics including age of the firm, stage of the firm and type of industry; 2) VC characteristics include industry experience, total investment experience and past success experienced by the investors; 3) deal characteristics include size of investment, stage funding in various round, syndication and VC stake holding in entrepreneurial firm, revenue generated in previous investment. The statistical significance of these factors is accessed through multinomial logistic regression analysis across different categories of security choice undertaken by venture capitalist in Indian start-ups.

Suggested Citation

  • Sarita Mishra & Suresh Kumar Sahoo, 2023. "Determinants of security design in venture capital investment: a study on Indian start-ups," Global Business and Economics Review, Inderscience Enterprises Ltd, vol. 29(1), pages 1-15.
    • Handle: RePEc:ids:gbusec:v:29:y:2023:i:1:p:1-15
    as

    Download full text from publisher

    File URL: http://www.inderscience.com/link.php?id=131944
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ids:gbusec:v:29:y:2023:i:1:p:1-15. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sarah Parker (email available below). General contact details of provider: http://www.inderscience.com/browse/index.php?journalID=168 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.