Informed Capital in a Hostile Environment: The Case of Relational Investors in Germany

Dorothea Schäfer and Dirk Schilder

No 549, Discussion Papers of DIW Berlin from DIW Berlin, German Institute for Economic Research

Abstract: Informed capital is a crucial ingredient to a well-functioning market for start-up finance, especially in times of difficult market conditions. For bank-based systems, the question regarding which investors actually supply informed capital has not yet been answered. To fill this gap, we conduct a survey among German suppliers of start-up finance. We find significant differences between the investors which are linked to banks and those financiers which are not. Although, the bankrelated group, including public equity suppliers, delivers some sort of informed capital, venture capital companies and Business Angels are the key providers of informed capital in the German market for start-up finance.

Keywords: Informed capital; Start-up financing; Venture capital; Banks; Information (search for similar items in EconPapers)
JEL-codes: D21 G21 G24 M13 O16 (search for similar items in EconPapers)
Pages: 28 p.
Date: 2006
New Economics Papers: this item is included in nep-eec and nep-fmk
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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Related works:
Working Paper: Informed capital in a hostile environment: the case of relational investors in Germany (2006)
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