Does Venture Capital Investment Really Require Spatial Proximity? An Empirical Investigation

Michael Fritsch and Dirk Schilder

Papers on Entrepreneurship, Growth and Public Policy from Max Planck Institute of Economics, Entrepreneurship, Growth and Public Policy Group

Abstract: We examine the role of spatial proximity for Venture Capital (VC) investments in Germany. The main database is a survey of 85 personal interviews with representatives of different types of financial institutions. The analysis shows that spatial proximity is far less important for VC investments than is often believed. For example, the results indicate that syndication is partly used as an alternative to spatial proximity. Telecommunication does not work as a substitute for face-to-face contact. On the whole, regional proximity is not a dominant factor in VC partnerships. Therefore, the absence of VC firms in a region does not appear to cause a severe regional equity gap.

Keywords: Venture Capital; spatial proximity; start-up financing (search for similar items in EconPapers)
JEL-codes: D21 G24 M13 O16 R12 (search for similar items in EconPapers)
Pages: 33 pages
Date: 2006-05
New Economics Papers: this item is included in nep-bec, nep-cfn, nep-ent, nep-fin, nep-fmk, nep-geo, nep-ino and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

Downloads: (external link)
ftp://papers.econ.mpg.de/egp/discussionpapers/2006-14.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 500 Failed to connect to FTP server papers.econ.mpg.de: No such host is known.

Related works:
Journal Article: Does Venture Capital Investment Really Require Spatial Proximity? An Empirical Investigation (2008)
Working Paper: Does venture capital investment really require spatial proximity? An empirical investigation (2006)
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:esi:egpdis:2006-14

Ordering information: This working paper can be ordered from
http://www.econ.mpg. ... arch/EGP/discuss.php

Access Statistics for this paper

More papers in Papers on Entrepreneurship, Growth and Public Policy from Max Planck Institute of Economics, Entrepreneurship, Growth and Public Policy Group Contact information at EDIRC.
Bibliographic data for series maintained by Kerstin Schück ( this e-mail address is bad, please contact ).