Is Venture Capital a regional business? – The role of syndication

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 investigate whether the supply of Venture Capital (VC) in Germany is driven by spatial influences. The study is based on information from more than 300 VC investments made in Germany between 2004 and 2005. We find evidence that the geographical distance between a VC company and the portfolio firm is not an important factor for German VC investments. Syndication of investments helps to overcome the problem of distance to portfolio firms if one of the investors is located close to the investment. Altogether, we find no evidence for a severe regional equity gap for young and innovative companies in Germany.

Keywords: Venture Capital; regional equity gap; start-up financing (search for similar items in EconPapers)
JEL-codes: D21 G24 M13 O16 R12 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2006-10
New Economics Papers: this item is included in 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 (11)

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Working Paper: Is venture capital a regional business? The role of syndication (2006)
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