Chugh, Harveen, Nicolaou, Nicos and Barnes, Simon (2011) How does VC feedback affect start-ups? Venture Capital, Volume 13 (Number 3). pp. 243-265. doi:10.1080/13691066.2011.600285

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Abstract

This study examines how venture capital (VC) feedback affects start-ups through a three-year qualitative study of university spin-offs. We present a taxonomy of VC feedback into (i) inconsistent, (ii) consistent and workable, and (iii) consistent and unworkable feedback. We find that when start-ups fail to raise VC, inconsistent VC feedback leads to a greater escalation of commitment than consistent and workable VC feedback. We show that single-loop learning mediates the relationship between VC feedback and escalation of commitment. We find that consistent and unworkable VC feedback increases the likelihood of a firm's exit, and that inhibited double-loop learning mediates the relationship between VC feedback and an exit.

Item Type:	Journal Article
Divisions:	Faculty of Social Sciences > Warwick Business School > Entrepreneurship, Innovation & Management Faculty of Social Sciences > Warwick Business School
Journal or Publication Title:	Venture Capital
Publisher:	Routledge
ISSN:	1369-1066
Official Date:	17 October 2011
Dates:	Date Event 17 October 2011 Published 20 June 2011 Accepted
Volume:	Volume 13
Number:	Number 3
Number of Pages:	22
Page Range:	pp. 243-265
DOI:	10.1080/13691066.2011.600285
Status:	Peer Reviewed
Publication Status:	Published
Access rights to Published version:	Restricted or Subscription Access

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