Investor Horizon and the Life Cycle of Innovative Firms: Evidence from Venture Capital
研究了风险投资基金合同期限如何影响其对创新企业的投资，发现剩余期限更长的基金更早投资于年轻公司，这些公司专利增长更快，且经验丰富的风投公司对期限更敏感。
This paper studies whether and how the contractual horizon of venture capital funds affects their investments in innovative firms. I find that funds with a longer remaining horizon select younger companies at an earlier stage of their development, which grow their patent stock significantly more than companies financed by funds with a shorter horizon. The sensitivity of investment decisions to horizon is stronger among experienced venture capital firms, who allocate investments across a larger number of fund vintages. Finally, I find that the interaction of funds’ fixed horizon with their option-like compensation structure affects their investment decisions: when early performance has been high, fund managers target less innovative companies. These findings shed light on the drivers of venture capital investment decisions and on their implications for the type of companies that receive venture capital financing. This paper was accepted by Gustavo Manso, finance.