Private equity investment criteria: An experimental conjoint analysis of venture capital, business angels, and family offices
By Joern H. Block, Christian Fisch, Silvio Vismara, René Andres. Journal of Corporate Finance, 2019
184 citations recorded by the source corpus.
We use an experimental conjoint analysis to investigate the investment criteria of 749 private equity investors, distinguishing between family offices, business angels, venture capital funds, growth equity funds, and leveraged buyout funds. Our results indicate that revenue growth is the most important investment criterion, followed by the value-added of product/service, the management team's track record, and profitability. Regarding differences across investor types, we find that family offices, growth equity funds, and leveraged buyout funds place a higher value on profitability as compared to business angels and venture capital funds. Venture capital funds, in turn, pay more attention to companies' revenue growth, business models, and current investors. With these results, our study contributes to the corporate finance literature by deepening our understanding of how different types of private equity investors make investment decisions.
Subfields: Accounting, Finance
View Paper: https://www.semanticscholar.org/paper/10547495d251a283f6b9b325612f1f5e088f44df
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In Accounting
- Joern H. Block
- Christian Masiak
- Christian Fisch
- Silvio Vismara
- Paul P. Momtaz
- Tom Vanacker
- Lars Hornuf
- Armin Schwienbacher
In Finance
Citations in the corpus
- Motives and profiles of ICO investors (2019, result): “Late respondents resemble nonrespondents, and the results might be biased if late respondents are significantly different from early respondents (e.g., Armstrong & Overton, 1977; Block et al., 2019; Graham & Harvey, 2001).”