Description
Brazil Russia India and China form the largest economic bloc which significant growth potential. The GDP’s of these economies are growing at a fast pace and significant portion of this GDP in future will be driven by new high technology ventures (or startups) funded by venture capitalists. In the current paper, we study the relationship between venture capital funding and characteristics of entrepreneurs in these economies. We study how prior experience and educational qualifications of entrepreneurs affect venture capital funding and the success of their ability to raise venture capital funding. Our results indicate a positive correlation between experience, and, education and the likelihood of getting funded. In addition, our results indicate that entrepreneurs who have significant domain expertise (boiling frogs) and prior entrepreneurship experience have a higher likelihood of getting funded, when compared to other entrepreneurs who shift and change jobs frequently (rolling stones). We attribute some of these results to the inherent risk aversion behavior of venture capitalists in environments where institutional frameworks and appropriability regimes are still developing.
Recommended Citation
Subramanian, Hemang; Chen, Min; and Jiang, Haoqiang, "Entrepreneurship in BRIC: Who will Venture capitalists fund?" (2017). AMCIS 2017 Proceedings. 6.
https://aisel.aisnet.org/amcis2017/HumanIS/Presentations/6
Entrepreneurship in BRIC: Who will Venture capitalists fund?
Brazil Russia India and China form the largest economic bloc which significant growth potential. The GDP’s of these economies are growing at a fast pace and significant portion of this GDP in future will be driven by new high technology ventures (or startups) funded by venture capitalists. In the current paper, we study the relationship between venture capital funding and characteristics of entrepreneurs in these economies. We study how prior experience and educational qualifications of entrepreneurs affect venture capital funding and the success of their ability to raise venture capital funding. Our results indicate a positive correlation between experience, and, education and the likelihood of getting funded. In addition, our results indicate that entrepreneurs who have significant domain expertise (boiling frogs) and prior entrepreneurship experience have a higher likelihood of getting funded, when compared to other entrepreneurs who shift and change jobs frequently (rolling stones). We attribute some of these results to the inherent risk aversion behavior of venture capitalists in environments where institutional frameworks and appropriability regimes are still developing.