Venture Capitalists’ Investment Criteria in Poland: Entrepreneurial Opportunities, Entrepreneurs, and Founding Teams

Rafał Morawczyński
Additional contact information
Rafał Morawczyński: Department of Entrepreneurship and Innovation, Cracow University of Economics, ul. Rakowicka 27, 31-510 Kraków, Poland

Administrative Sciences, 2020, vol. 10, issue 4, 1-30

Abstract: The aim of this article is to explore the decision-making policies by Polish Venture Capital (VC) firms, with special focus on the perception of entrepreneurs. This paper presents the results of a conjoint analysis and assessment of the importance of select characteristics among entrepreneurs and the qualities of a team of founders comprising managers of VC firms. The data were collected via face-to-face interviews with 26 Venture Capitalists. In the conjoint experiment, six attributes were presented, among which three represented characteristics of the entrepreneur (his/her passion and experience) and the management team (experience and completeness) alongside three characteristics of the opportunity (readiness of the product/service, growth rate of the market, and innovativeness of the whole project). VC managers ranked the importance of eight characteristics of the entrepreneurs related to their decisions and assessed the functional composition of the team of founders. The results of the experiment show that venture capitalists (VCs) most strongly appreciate the readiness of the product and entrepreneur’s passion. However, their preferences varied across the sample. The results of the ranking also show that the VC managers highly value the honesty of the entrepreneur. VCs typically prefer a team of founders, rather than a single-person project, preferably consisting of persons at least familiar with the technology and the market. This study contributes significantly to the state-of-the-art, as research on VC investment policy (investment criteria) is relatively rare in Central and Eastern Europe, where the VC industry is starting to flourish.

Keywords: Venture Capital; entrepreneurship; entrepreneurs; entrepreneurial teams; investment criteria (search for similar items in EconPapers)
JEL-codes: L M M0 M1 M10 M11 M12 M14 M15 M16 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.mdpi.com/2076-3387/10/4/77/pdf (application/pdf)
https://www.mdpi.com/2076-3387/10/4/77/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jadmsc:v:10:y:2020:i:4:p:77-:d:425858

Access Statistics for this article

Administrative Sciences is currently edited by Ms. Nancy Ma

More articles in Administrative Sciences from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().