The Rise of Venture Philanthropy: private capital and public benefit (original) (raw)
The funding of venture capital in Europe: issues for public policy
This paper considers the key questions facing public policy-makers in the European Union in developing policies to stimulate venture capital. The first is how to define when and where public intervention is necessary and justifiable. The second is to identify precise policy objectives. Thirdly, should the public sector take the same or more of the risk and less of the return than the private sector? Then, what instruments should the public sector deploy (equity, grants, guarantees or loans, or a combination)? Finally, when should public intervention cease? The paper considers the experience of instruments at both European and national levels and some of the policy debates. It concludes with reminders that venture capital is not the most appropriate form of finance for all small businesses; that venture capital will not in any case succeed in promoting growth unless an appropriate framework exists also on the demand side to support the emergence of growth companies; and that venture capital in Europe must be complemented by the growth of entrepreneurial finance from other sources, notably business angels, who have played a key role in the US experience.
European venture capital: Strategies and challenges in the 90s
European Management Journal, 1990
This paper summarizes the current perceptions of leading European venture capitalists as an aid to those involved in formulating strategies or determining public policy. Secondarily, it provides an excellent view of venture capital in the 1990s against which actual developments may be compared. These views are developed in a survey of 34 firms, which manage over onequarter of the European venture capital pool.
The Changing Face of the European Venture Capital Industry
The Journal of Private Equity, 2004
We would like to thank the many venture capitalists who generously provided us with data. We owe a special thank to March Schublin at the European Investment Fund for supporting this project from day one. Elena Rotondi cheerfully and efficiently helped us at all stages. Our colleague Pietro Terna at Turin University made the online collection of data possible. Last but not least, Roberto Bonfatti, Matteo Ercole and Alessandro Gavazzeni provided long hours of outstanding research assistance.
Public versus private venture capital: seeding or crowding out? A pan-European analysis
Journal of Business Venturing, 2003
This paper analyzes the relationship between public and private sources of venture capital in Europe and the development of the industry, controlling for characteristics of the legal systems, in 15 European countries over the period 1990-1996. Large public participation is correlated with smaller VC industries, but analyses do not support the view that public venture capitalists are acting to seed the industry or that are they crowd-out private funds. On the contrary, public involvement seems to cause greater amounts of money to be invested in the industry as a whole. We argue that the effects of public intervention, whatever the motives, are real and probably result from demonstrating/sanctioning the social merit of venture capital and from signaling an enduring commitment to it.
A Research of EU-27 Private Equity and Venture Capital Markets
2010
This research investigates market parameters describing the Private Equity and Venture Capital industry in the EU-27. Building on the review of relevant economic literature and recent surveys, the study identifies a number of meaningful indicators and proposes a model based on three clusters (social, economic, and industrial) not adequately considered in previous analysis. The model considers general governance indicators such as accountability and regulatory quality as well as economic and industrial ones like the level of Private Equity investments, inflation, and market capitalization of listed companies. The research then evaluates the position of the EU-27 economies vis-a-vis the selected indicators to observe the historical performance of countries and its relation with the EU average. The study also reviews the limits of the approach and suggests prospects for improvement through additional inferential analysis and through the creation of a Private Equity Market Index (PEMI)....
European Business Organization Law Review, 2006
This survey article summarizes the findings of four research projects on the venture capital industry in Europe and the role played by legal institutions and the legal framework. A study on patent litigation insurance argues that insurance can create a level playing field for small innovators, but that compulsory insurance can only be justified as a transitory scheme. The second study argues that intermediaries from countries with a better legal tradition will provide more governance and value added services, even when investing abroad. It also provides supportive empirical evidence based on an extensive questionnaire-study. The third project investigates the relationship between venture investments and a widely used legality index in 39 countries, finding that better laws facilitate faster deal screening and origination, lead to a higher probability of syndication, and also facilitate board representation of the investors. The final study documents a significant performance gap between the European and the US venture capital industry, but argues that the difference can not be attributed to differences in legal origin.
arXiv (Cornell University), 2021
This research focuses on the study of relationships between public and private equity investors in France. In this regard, we need to apprehend the formal or informal nature of interactions that can sometimes take place within traditional innovation networks . For this, our article mobilizes a public-private partnerships approach (PPPs) and the resourcebased view theory. These perspectives emphasize the complementary role of disciplinary and incentive mechanisms as well as the exchange of specific resources as levers for value creation. Moreover, these orientations crossed with the perspective of a hybrid form of co-investment allow us to build a coherent and explanatory framework of the mixed syndication phenomenon. Our methodology is based on a qualitative approach with an interpretative aim, which includes twenty-seven semi-structured interviews. These data were subjected to a thematic content analysis using Nvivo software. The results suggest that the relationships between public and private Venture capitalists (VCs) of a formal or informal nature, more specifically in a syndication context, at a national or regional level, are representative of an "economicocognitive" (Farrugia, 2014, page 6) approach to networking and innovation. Moreover, the phenomenon of mixed syndication reveals a context of hybridization of public and private actors that would allow the private VCs to benefit from the distribution of wealth when the company develops its innovation. We can also identify a process related to a quest for legitimacy on the part of the public actor characterized by its controlling role within the publicprivate partnership . Finally, our study has some limitations. One example is the measurement of the effects of relationships on "visible" or "invisible" innovation
Public Policy Support for the Informal Venture Capital Market in Europe: A Critical Review
International Small Business Journal, 2009
The ability of small firms to access finance is hindered by persistent market failure which creates funding gaps for new businesses, particularly in technology sectors, seeking small amounts of finance. This has prompted various forms of public sector intervention to increase the supply of both debt and risk finance. For the past decade (longer in the UK) both the EU and Member States have increasingly focused on the informal venture capital market as a means of increasing the supply of early stage venture capital .This paper describes the changing nature of the forms of intervention and provides a critical review of their effectiveness. The lack of data on angel investing means that there is very little evidence on the impact of these forms of intervention. The paper advocates that governments should invest in appropriate methodologies which can accurately measure investment trends in the early stage venture capital market, and specifically angel investment activity, so that the need for public sector intervention can be demonstrated and the impact of such interventions can be measured.