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Role of characteristics of key partners on the funding decisions by venture capitalists in startups

Oude Avenhuis, P. (2018) Role of characteristics of key partners on the funding decisions by venture capitalists in startups.

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Abstract:This paper explores the role that specific characteristics of key partners of startups have on the investment decision of venture capitalists. Venture capitalists use several criteria when making investment decisions. However, a universal framework is missing. This paper aims at obtaining a universal guideline for startups regarding key partners. When important characteristics of key partners have been identified, startups can develop their network to satisfy the requirements of venture capitalists. A survey has been conducted among the 59 venture capitalists that invest in the seed- and early stage of startups. The results were analyzed and described. The major finding is that venture capitalists require an established partner which can guide the startup through challenges, problems and opportunities. Moreover, the established partner can share its resources, both knowledge and materials. This helps the startup to develop and possibly scale up its activities. Another role that is preferred by venture capitalists is the role of customer. A key partner as (potential) customer guarantees revenue and proves the business concept of the startup.
Item Type:Essay (Bachelor)
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:85 business administration, organizational science
Programme:International Business Administration BSc (50952)
Link to this item:https://purl.utwente.nl/essays/75351
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