Speaker Series 2005-2006

Firm-centric and group-centric influences on venture capital firms' involvement in new ventures
 
Harry Sapienza
Carlson School of Management
University of Minnesota

Thursday, March 16, 2006, 9:00 - 10:30 AM
Room 1505

Abstract: Drawing on expectancy-value theory and theories focusing on individuals’ behavior in group settings (equity, role, and social loafing theories), we argue that the behavior of individual firms in a group setting will depend both on individual firm incentives and on factors stemming from the firms’ membership in that group. We apply our theoretical arguments to the context of venture capital syndicates, and we test our hypotheses using data on 162 venture capital firms drawn from a survey instrument and a secondary data source.  Our results show that individual firms’ involvement in the group is dominated by group effects: the financial stake relative to the group and the reputation of the other group members significantly influence the focal firm’s involvement. We discuss the implications of our findings for future research.

Harry Sapienza Harry Sapienza is Professor, Strategic Management and Organization, Carlson School of Management at the University of Minnesota.  Harry is the Curtis L. Carlson Chair in Entrepreneurial Studies and the Co-Director of the Carlson School’s Center for Entrepreneurial Studies. He holds a PhD from the University of Maryland in Strategic Management. Harry’s research interests various aspects of entrepreneurship, strategy, and entrepreneurial leadership including the interface between venture capitalists and entrepreneurs, the creation and management of inter-organizational relationships, strategic decision-making, and the internationalization of high-technology ventures.  He has published over 40 refereed articles in such outlets as Academy of Management Journal, Academy of Management Review, Journal of Business Venturing, Journal of Management, Journal of Management Studies, and the Strategic Management Journal.  Harry served over ten years on the editorial board of the Journal of Business Venturing and is currently on the editorial boards of Organization Science and Venture Capital, among others.  

Curriculum Vita