Time tells: Unraveling the temporal and risk dynamics of venture capitalists

About the Research

Access to funds is critical for new ventures, yet many struggle to secure financing. Why are some investors more likely than others to finance new ventures? We address this question by studying the influence of time and risk preferences on venture capitalists’ investment decisions. Using data from a large-scale survey of venture capitalists in Europe, we show that patient venture capitalists favor early-stage firms, whereas risk-averse venture capitalists invest more in mature firms. Moreover, we show that risk and time preferences provide different pathways to success: risk-averse investors exit more through trade sales, whereas patient investors exit more often through IPOs. The most favorable path to an IPO occurs when investors are both patient and risk-taker, highlighting an interplay between risk and time preferences.

About Mario Amore

Mario Daniele Amore is the Schwarz Foundation Chaired Professor of Strategy and Family Business at HEC Paris. Mario is also Research Affiliate at the Center for Economic Policy Research (CEPR), Research Member at the European Corporate Governance Institute (ECGI), and Board Member at the International Corporate Governance Society (ICGS). Prior to joining HEC Paris, Mario was Full Professor at Bocconi University. He currently serves as Associate Editor of Management Science and Journal of Corporate Finance, and Editorial Review Board Member of Strategic Management Journal. Mario’s research focuses on family business, corporate governance, and strategy. Furthermore, he is interested in the decision-making of entrepreneurs and corporate managers. Mario’s works have been published in leading journals such as Management Science, Journal of Financial Economics, Strategic Management Journal, and Organization Science. His research has also been featured in several media outlets including Harvard Business Review, The Wall Street Journal, Bloomberg, and Harvard Law School Forum on Corporate Governance.

Date: Thursday 16 May, 2024

Time: 12:00-13:30 CEST

Venue: Training Room (Zoom link provided to registered attendees)

Reminder: We are buying fewer plastic water bottles to reduce waste, so please bring your own water.

Should you want to attend, please register at https://forms.gle/rYxqPmw7cZsCrsHU8