Evaluation of entrepreneurial teams: early-stage investment decisions in new technology-based firms

Kirsti Dautzenberg and Guido Reger

International Journal of Entrepreneurial Venturing, 2010, vol. 2, issue 1, 1-22

Abstract: In new technology-based firms (NTBFs), entrepreneurial teams rather than single entrepreneurs seem to be better-suited to handle uncertainties and volatilities. Recent works suggest that the skills, abilities and interactive dynamics of the entrepreneurial team seem to be highly important in explaining new venture performance. Therefore, entrepreneurial teams play a key role in venture capitalist evaluations. We developed a process model for the venture capitalists' evaluations of entrepreneurial teams during the investment decision process for early-stage financing in NTBFs. The present model combines attributes of entrepreneurial team composition and trust-based relationships between the entrepreneurial team and the investor. Finally, we discuss the implications and limitations of our proposed model.

Keywords: early-stage finance; entrepreneurial teams; new technology based firms; NTBFs; team composition; trust; start-up teams; venture capital; decision making; teamwork; team evaluation; investment decisions; entrepreneurship. (search for similar items in EconPapers)
Date: 2010
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