Investment cycles and startup innovation |
| |
Authors: | Ramana Nanda Matthew Rhodes-Kropf |
| |
Institution: | 1. Harvard Business School, Harvard University, United States;2. NBER, United States |
| |
Abstract: | We find that venture capital-backed startups receiving their initial investment in hot markets are more likely to go bankrupt, but conditional on going public, are valued higher on the day of their initial public offering, have more patents, and have more citations to their patents. Our results suggest that VCs invest in riskier and more innovative startups in hot markets (rather than just worse firms). This is particularly true for the most experienced VCs. Furthermore, our results suggest that increased capital in hot times plays a causal role in shifting investments to more novel startups by lowering the cost of experimentation for early stage investors and allowing them to make riskier, more novel, investments. |
| |
Keywords: | G24 G32 O31 |
本文献已被 ScienceDirect 等数据库收录! |
|