Why Do European Venture Capital Companies Syndicate?
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Financial theory, resource-based theory and access to deal flow are used to explain syndication practices among European venture capital (VC) firms. The desire to share risk and increase portfolio diversification is a more important motive for syndication than the desire to access additional intangible resources or deal flow. Access to resources is, however, more important for non-lead than for lead investors. When resource-based motives are more important, the propensity to syndicate increases. Syndication intensity is higher for young VC firms and for VC firms, specialised in a specific investment stage. Finally, syndication strategies are similar across European countries, but differ from North American strategies.
- financial diversification theory
- resource-based theory
- venture capital strategies
- M : Business Administration and Business Economics; Marketing; Accounting
- L2 : Firm Objectives, Organization, and Behavior
- M10 : Business Administration: General
- G24 : Investment Banking; Venture Capital; Brokerage; Ratings and Ratings Agencies
- vc firms
- vc firm
- non-lead investors