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Journal of Finance Vol. 70 No. 3 2015

Is a VC Partnership Greater Than the Sum of Its Partners?

Michael Ewens1,2,3; Matthew Rhodes–Kropf4

1 National Bureau of Economic Research · 2 Dana-Farber/Harvard Cancer Center · 3 Carnegie Mellon University · 4 Ewens is with Carnegie Mellon University, Tepper School of Business, and Rhodes-Kropf is with Harvard Business School. We thank Viral Acharya, Joshua Coval, Peter DeMarzo, Joan Farre-Mensa, Thomas Hellmann, Bill Kerr, Josh Lerner, Ramana Nanda, David Robinson, Merih Sevilir, and Morten Sorensen for

open access

Abstract

This paper investigates whether individual venture capitalists have repeatable investment skill and the extent to which their skill is impacted by the venture capital (VC) firm where they work. We examine a unique data set that tracks the performance of individual venture capitalists' investments over time and as they move between firms. We find evidence of skill and exit style differences even among venture partners investing at the same VC firm at the same time. Furthermore, our estimates suggest the partners' human capital is two to five times more important than the VC firm's organizational capital in explaining performance.

DOI
10.1111/jofi.12249
Volume
70
Issue
3
Pages
1081-1113
Language
en
Sources
bibtex:phds-export.bib openalex crossref

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