Venture capital firms valuation in bull and bear markets: evidence from Sweden Online publication date: Fri, 13-Mar-2020
by Anders Isaksson; Öystein Fredriksen
International Journal of Entrepreneurship and Innovation Management (IJEIM), Vol. 24, No. 2/3, 2020
Abstract: This study uses an experimentally designed case study approach to investigate Swedish venture capital firms' valuation practices in two different economic contexts – the economic boom (bull market) of 1999 and the downturn (bear market) of 2002. A key finding in our study is that during economic downturns, venture capital firms employed fewer and less advanced valuation methods – relying more on rules of thumb and gut feeling than during boom times. We conclude that investor behaviour is considerably affected by current economic conditions and advocate strongly that it be considered in future research on not only venture capital valuation, but also investor behaviour in general. This study thus enriches the knowledge of venture capitalists' valuation practices, in general and how market conditions affect them. Furthermore, the results can also aid researchers in developing more relevant theories of valuation, valuation models and valuation practices.
Existing subscribers:
Go to Inderscience Online Journals to access the Full Text of this article.
If you are not a subscriber and you just want to read the full contents of this article, buy online access here.Complimentary Subscribers, Editors or Members of the Editorial Board of the International Journal of Entrepreneurship and Innovation Management (IJEIM):
Login with your Inderscience username and password:
Want to subscribe?
A subscription gives you complete access to all articles in the current issue, as well as to all articles in the previous three years (where applicable). See our Orders page to subscribe.
If you still need assistance, please email subs@inderscience.com
Our Blog 
Follow us on Twitter 
Visit us on Facebook