Sources of Funds and Investment Activities of Venture Capital Funds: Evidence from Germany, Israel, Japan and the UK

Colin Mayer (), Yishay Yafeh and Koen Schoors

No 3340, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Using a newly constructed data set, we compare sources of funds and investment activities of venture capital (VC) funds in Germany, Israel, Japan and the UK. Sources of VC funds differ significantly across countries, eg banks are particularly important in Germany, corporations in Israel, insurance companies in Japan and pension funds in the UK. VC investment patterns also differ across countries in terms of the stage, sector of financed companies and geographical focus of investments. We find that these differences in investment patterns are related to the variations in funding sources ? for example, bank and pension fund backed VC firms invest in later stage activities than individual and corporate backed funds ? and we examine various theories concerning the relation between finance and activities. We also report that the relations differ across countries; for example, bank backed VC firms in Germany and Japan are as involved in early stage finance as other funds in these countries, whereas they tend to invest in relatively late stage finance in Israel and the UK. We consider the implication of this for the influence of financial systems on relations between finance and activities.

Keywords: Venture capital; Financial institutions; Sources of funds (search for similar items in EconPapers)
JEL-codes: G20 O32 (search for similar items in EconPapers)
Date: 2002-04
New Economics Papers: this item is included in nep-cfn, nep-ent and nep-mfd
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Citations: View citations in EconPapers (36)

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Working Paper: Sources of Funds and Investment Activities of Venture Capital Funds: Evidence from Germany, Israel, Japan and the UK (2003)
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