This paper investigates how patents held by new ventures affect their ability to attract venture capital (VC) financing. For a sample of VCseeking German and British biotechnology companies we have identified all patents filed at the European Patent Office. We find that in the presence of patent applications, VC financing occurs earlier. Our results suggest that VCs pay attention to patent qual...

I develop a model of venture capital (VC) intermediation that can quantitatively explain central empirical facts about VC activity and allows evaluating its impact on economic growth. The framework reveals how pro-cyclical VC investment dynamics reinforce themselves through a risk premium channel that rationalizes low funding standards in booms. VC investments’ aggregate impact is significantly...

New transit capital expenditures are typically evaluated in isolation from the transit/transport systems to which they belong. Problems with reporting performance elements such as ridership and costs are discussed. A focus on evaluating the total transport systems impact of new transit project implementation is called for. On this basis, new US rail transit systems have generally performed poor...

The returns to private equity investment have become a vexed issue, attracting widespread debate in the media, government, and among researchers. Much of the attention has focused on later-stage buyout investments, but there is a general move towards greater transparency and disclosure of the returns to both early and late-stage venture capital (VC) investments. Shortcomings in the information ...

We study the investment analyses of 67 portfolio investments by 11 venture capital (VC) firms. VCs describe the strengths and risks of the investments as well as expected postinvestment actions. We classify the risks into three categories and relate them to the allocation of cash flow rights, contingencies, control rights, and liquidation rights between VCs and entrepreneurs. The risk results s...

To what extent do venture capital (VC) investors use information from patents to assess the quality of new ventures? Using a sample of 370 U.S. semiconductor start-ups, we examine when patents improve the terms by which new firms access venture capital.

In this paper, we examine whether a failure-tolerant corporate culture spurs corporate innovation and increases firm value based on a sample of venture capital (VC) backed IPO firms. We develop a novel firm-specific measure of a failure-tolerant corporate culture hinging on the idea that the formation of corporate culture is largely determined by the attitudes and beliefs of its founders and ea...

paper presents preliminary fi ndings and is being distributed to economists and other interested readers solely to stimulate discussion and elicit comments. The views expressed in this paper are those of the authors and are not necessarily refl ective of views at the Federal Reserve Bank of New York or the Federal Reserve System. Any errors or omissions are the responsibility of the authors. fo...

Across Europe, different kinds of research organisations are confronted with the challenge of managing their most valuable resources, which are knowledge based, in a more explicit and transparent manner. Over the last few years a small number of research organisations have started to implement new instruments for managing and measuring their knowledge-based resources and processes. The research...

An important type of product differentiation in the venture capital (VC) market is industry specialization. We estimate a market structure model to assess competition among VCs—some of which specialize in a particular industry and others of which are generalists—and find that the incremental effect of additional same-type competitors increases as the number of same-type competitors increases. F...