Of Acting Principals and Principal Agents: Goal Incongruence in the Venture Capitalist-Entrepreneur Relationship
Journal
International Journal Entrepreneurship and Small Business
ISSN
1476-1297
ISSN-Digital
1741-8054
Type
journal article
Date Issued
2009-01-01
Author(s)
Abstract
This qualitative study examines the motivations for venture capitalists and entrepreneurs to act opportunistically toward one another. Structured interviews with 14 employees and 5 investors in a venture capital-funded start-up revealed that venture capitalists expect opportunistic behaviour from entrepreneurs during investment rounds but largely trust entrepreneurs between financing rounds. Both venture capitalists and entrepreneurs reported that venture capitalists act opportunistically towards the entrepreneur and other venture partners during all stages of start-up development. These findings have important implications for entrepreneurship research, most notably the applicability of agency theory as a theoretical perspective from which to view the complex relationship between venture capitalists and entrepreneurs.
Language
English
Keywords
Venture Capital
Entrepreneurship
Agency Theory
Goal Incongruence
HSG Classification
contribution to scientific community
Refereed
Yes
Publisher
Inderscience
Publisher place
Olney, Bucks
Volume
7
Number
3
Start page
367
End page
388
Pages
22
Subject(s)
Eprints ID
40493
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Name
A01_Christensen_Wuebker_Wustenhagen_IJESB_2009.pdf
Size
305.09 KB
Format
Adobe PDF
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