Title: Self-regulation in European venture capital and private equity markets

Authors: Jose Marti, Marina Balboa

Addresses: Departamento de Economia Financiera III, Universidad Complutense de Madrid, 28223 Pozuelo de Alarcon, Madrid, Spain. ' Departamento de Economia Financiera, Universidad de Alicante, Apartado de Correos 99, 03080 San Vicente del Raspeig, Alicante, Spain

Abstract: This paper proposes a conceptual framework based on both environmental and industrial factors that could explain, in aggregated terms, capital flows within venture capital and private equity markets. The interaction between supply and demand is directly affected by three conditions: the size of the domestic market, the accessibility of a stock market for growing companies, and the entrepreneurial environment. Evidence is found for the significant impact of all three conditions on the aggregated commitments to venture capital and private equity organisations in a panel of 16 European countries. Prior to its inclusion in our model, we find evidence of the impact that several instruments related to the entrepreneurial environment exert on investments.

Keywords: fundraising; private equity; venture capital; self-regulation; Europe; capital flows; entrepreneurship; innovation management.

DOI: 10.1504/IJEIM.2006.010373

International Journal of Entrepreneurship and Innovation Management, 2006 Vol.6 No.4/5, pp.395 - 411

Published online: 17 Jul 2006 *

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