Effect of Professional Background on Venture Capital Proposal Evaluation

Authors

  • Richard B. Carter Iowa State University
  • Howard E. Van Auken Iowa State University

Abstract

This paper reports on the differences in investment related activities and evaluation criteria of venture capitalists having a business background compared to venture capitalists having a non-business background . Data was collected from a  nationwide survey  of 72 venture capitalists. The results show that venture capitalists having a non-business" background invest in earlier stages of the firm. require a shorter payback period and make more follow-up investments than business background venture capitalists. The non-business background venture capitalists place greater importance on the uniqueness of the product , the cost structure of the project and the entrepreneur' s health and  less importance on exit procedures  than business background  venture capitalists.

References

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Published

1992-01-17

Issue

Vol. 3 No. 1 (1992)

Section

Articles

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How to Cite

Effect of Professional Background on Venture Capital Proposal Evaluation. (1992). Journal of Small Business Strategy (archive Only), 3(1), 45-55. https://libjournals.mtsu.edu/index.php/jsbs/article/view/428