Legality and venture capital governance around the world

Douglas Cumming, Daniel Schmidt and Uwe Walz ()

Journal of Business Venturing, 2010, vol. 25, issue 1, 54-72

Abstract: We analyze governance with a new dataset on investments of venture capitalists in 3848 portfolio firms in 39 countries from North and South America, Europe and Asia spanning 1971-2003. We provide evidence that cross-country differences in legality, including legal origin and accounting standards, have a significant impact on the governance structure of investments in the VC industry: better laws facilitate faster deal screening and deal origination, a higher probability of syndication and a lower probability of potentially harmful co-investment, and facilitate investor board representation of the investor. We also show that country-specific differences exist apart from legal and economic development.

Keywords: Venture; capital; Corporate; governance; Syndication; Entrepreneurial; finance (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (110)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jbvent:v:25:y:2010:i:1:p:54-72

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