Post-investment trajectories of Latin American young technology-based firms: an exploratory study

Manuel Gonzalo, Juan Federico, Sergio Drucaroff and Hugo Kantis

Venture Capital, 2013, vol. 15, issue 2, 115-133

Abstract: This study identifies and discusses the different post-investment trajectories of Latin American young technology-based firms (YTBFs). Two contrasting types of post-investment trajectories were identified: the ‘fast sale’, in which local YTBFs are purchased by a foreign firm and founders decide to leave the company, and the ‘multilatina’, in which the YTBF grows mainly by organic means and also through acquisitions until it becomes one of the industry's big global payers, with the founders still playing a leading role. There is also a continuum of intermediate situations such as in the case of Core where the original location remains as an R&D center in the context of the emerging post-investment configuration of the firm. These differences are related to the local resources in the emerging organizational configuration, notably the match between entrepreneurs' skills and vision, the growing demands of the firm after the investment, and the level of development of the local ecosystem. Foreign venture capital (VC) could play an important role in this regard by accelerating the pace of growth and internationalization faced by these firms. However, this could also lead to the exit of the entrepreneurs. The impact of these trajectories at the regional level should take account of the ‘entrepreneurial recycling’ concept suggested by Mason and Harrison (2006) by considering what happens with the entrepreneurs after the investment.

Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://hdl.handle.net/10.1080/13691066.2013.791088 (text/html)
Access to full text is restricted to subscribers.

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:taf:veecee:v:15:y:2013:i:2:p:115-133

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/TVEC20

DOI: 10.1080/13691066.2013.791088

Access Statistics for this article

Venture Capital is currently edited by Colin Mason and Richard T. Harrison

More articles in Venture Capital from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().