Can you always reap what you sow? Network and functional data analysis of VC investments in health-tech companies

Christian Esposito, Marco Gortan, Lorenzo Testa, Francesca Chiaromonte, Giorgio Fagiolo (), Andrea Mina and Giulio Rossetti

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Abstract: "Success" of firms in venture capital markets is hard to define, and its determinants are still poorly understood. We build a bipartite network of investors and firms in the healthcare sector, describing its structure and its communities. Then, we characterize "success" introducing progressively more refined definitions, and we find a positive association between such definitions and the centrality of a company. In particular, we are able to cluster funding trajectories of firms into two groups capturing different "success" regimes and to link the probability of belonging to one or the other to their network features (in particular their centrality and the one of their investors). We further investigate this positive association by introducing scalar as well as functional "success" outcomes, confirming our findings and their robustness.

Date: 2021-11
New Economics Papers: this item is included in nep-net
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Published in Proceedings of 10th International Conference of Complex Networks and their applications 2021

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Persistent link: https://EconPapers.repec.org/RePEc:arx:papers:2111.06371

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