Differences in the Screening Criteria between US and Continental European VC Investors

Research on venture capital (VC) decision-making has largely concentrated on investors within single countries or regions, with few comparative studies exploring differences in screening criteria across countries. This study fills this gap by examining how VC investors in the US and Europe prioritize key investment criteria, particularly revenue growth and international scalability. Employing a multimethod approach, we first conducted interviews with 19 VC experts to identify seven critical screening criteria. These criteria were then evaluated in a choice-based conjoint experiment involving 430 participants. Our findings highlight differences in investment priorities. US investors place significantly greater emphasis on high revenue growth rates while European investors prioritize international scalability. To further explore and interpret these differences, we conducted follow-up discussions with 11 VC investors from both regions. European investors stress that startups must be internationally scalable from an early stage. In contrast, US investors prioritize rapid revenue growth as a key indicator of market traction and investment potential. Additionally, European VCs adopt a more conservative investment approach while US VCs often embrace a higher-risk, high-reward strategy. Understanding the differences in investment preferences and criteria can help entrepreneurs tailor their strategies to better align with the expectations of US and European investors.