Venture Capitalist's Role in Choosing Entrepreneurs: A Study of Indian Biotechnology Industry
Part of the International Studies in Entrepreneurship book series (ISEN, volume 19)
The quest for knowledge economy in 1990s, where industries like information technology (IT), biotechnology etc. are in the forefront, has brought the role of venture capital into prominence. Since these industries are “ideas driven,” traditional mode of financing is not available to them. Venture capitalists (VCs) play an intermediary role in financial markets to provide funds to firms which otherwise have difficulty in acquiring funds. In the entrepreneurial setting, financial intermediaries such as venture capital fundings (VCFs) have been cited as perhaps the dominant source of selection (Anderson, 1999). VCs affect selection by providing financial resources to cash-hungry firms and by favoring new firms with, or requiring them to adopt, particular strategies, practices or other characteristics so as to convert ideas into products. VCs may also provide management expertise or access to other capabilities that bolster the competitive advantage of firms that they...
KeywordsGross Domestic Product Venture Capital Biotechnology Industry Venture Capital Investing Venture Capital Funding
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