The Exit Rates of Liquidated Venture Capital Funds

Markus Laine and Sami Torstila
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Markus Laine: Eqvitec Partners
Sami Torstila: Helsinki School of Economics

Journal of Entrepreneurial Finance, 2005, vol. 10, issue 1, 53-73

Abstract: Exit rates provide a simple yet practical measure for evaluating and benchmarking the performance of venture capital funds. We create a sample of 138 liquidated U.S. venture capital funds and investigate the outcomes of their 4,549 portfolio companies. We study exit rates, proportions of different exit routes, and their determinants. The median fund in our sample exited 19% of portfolio companies through an IPO, 7% through a sale of listed equity, and 23% through mergers or acquisitions. There exist, however, interesting differences between fund types: In particular, large funds and fund management firms have significantly higher exit rates.

Keywords: Capital; Exit; IPO; Venture Capital (search for similar items in EconPapers)
JEL-codes: G24 G32 L11 M13 (search for similar items in EconPapers)
Date: 2005
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