Effects of Innovativeness and Venture Stage on Venture Capitalist-Entrepreneur Relations

Harry J. Sapienza and Allen C. Amason
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Harry J. Sapienza: College of Business Administration, The University of South Carolina, Columbia, South Carolina 29208
Allen C. Amason: College of Business and Industry, Mississippi State University, Mississippi State, Mississippi 39762

Interfaces, 1993, vol. 23, issue 6, 38-51

Abstract: Innovative new ventures constitute a disproportionately large source of economic growth, and the amount of venture capital flowing into such ventures is increasing. A key component in the success of venture-capital-backed firms is the relationship between the lead venture capitalist (VC) and the venture's founding entrepreneur (E). We examined the impact of innovativeness and venture stage on VC-E relations in 51 venture-capital-backed firms and found: (1) greater marketing innovativeness in ventures associated with greater openness in VC-E pairs, (2) greater technological innovativeness in ventures associated with greater conflict in VC-E pairs, and (3) more frequent VC-E interaction in earlier stage ventures. We found that the relationship between technological innovativeness and openness of VC-E relations depended upon the venture's stage.

Keywords: marketing: new products; finance: investment (search for similar items in EconPapers)
Date: 1993
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Persistent link: https://EconPapers.repec.org/RePEc:inm:orinte:v:23:y:1993:i:6:p:38-51

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