Financing With Venture Capital: Advances in Knowledge Over the Last Ten Years and Research Avenues

Research Report Presented to
Industry Canada

by :
Josée St-Pierre, Ph.D.
and
Claude Mathieu, Ph.D.

With
Éric Andriambeloson and Hamid El Arch
Research Professionals

Institut de recherche sur les PME
April 25, 2003

Download the PDF version [2.6 MB] of this report.

Table of Contents

1. Introduction and Objectives

2. Methodology

• 2.1 Scientific writing, scientific events and identification of experts and centres of expertise in venture capital
• 2.2 Professional information, professional events and industry trends

3. Venture Capital: Academic Research

• 3.1 The role of venture capital in economic development, legal structures and the provenance of investors
  • 3.1.1 The impact on the economy, on job creation, on innovation and on performance
  • 3.1.2 The structure of capital supply (including private and public markets, the influence and control of governments on the supply of venture capital)
  • 3.1.3 Legal structures: VCC objectives and mission
  • 3.1.4 The balance between supply and demand in venture capital
• 3.2 The functioning of the venture capital market: financing decisions, risk measurement, contractual aspects
  • 3.2.1 The criteria for investment and the investment decision-making process for VCC
  • 3.2.2 The evaluation of risk (identification, estimate and mitigation)
  • 3.2.3 Contractual aspects of VC and their repercussions on SME
  • 3.2.4 The deciding factors in the involvement of VCC in SME
  • 3.2.5 Control mechanisms (investment control from the VCC's perspective)
  • 3.2.6 Investment in an SME as a component of a securities portfolio
• 3.3 Comparison between businesses that were financed by venture capital and those that were not (performance, sales, job creation, rate of innovation, etc.)
• 3.4 The impact of the venture capital company on the business that is financed
  • 3.4.1 The "professionalization" of SME after VC (introduction of business practices and procedures)
  • 3.4.2 The involvement and support of the VCC
• 3.5 The impact and rate of survival of businesses financed by VC after divestiture
  • 3.5.1 Exit strategies
  • 3.5.2 The Initial Public Offering
  • 3.5.3 The performance of financed companies
• 3.6 New trends
  • 3.6.1 Technological investment
  • 3.6.2 The future of stock markets for rapidly-growing SME
• 3.7 Conclusions: state of knowledge and avenues of research

4. Structure of the Venture Capital Market: Professional Associations and Events

• 4.1 Professional associations
• 4.2 Professional events

References

Appendix

• Topic 1: The role of venture capital in economic development, legal forms and the provenance of investors
• Topic 2: The functioning of the venture capital market: financing decisions, risk measurement, contractual aspects
• Topic 3: Comparison of businesses that were financed with venture capital and those that were not (performance, sales, job creation, rate of innovation, etc.)
• Topic 4: The impact of a venture capital company on the business that is financed
• Topic 5: Impact and rate of survival of businesses that are financed with VC after the divestiture of the VCC
• Topic 6: New trends

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Date Modified: 2008-10-10

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