Classification and Analysis of Criteria Used in the Due Diligence Process

Ma Camino Ramón-Llorens, Ginés Hernández-Cánovas

Abstract


This paper uses a survey dataset of 51 Venture Capital Companies to address a segmentation of the venture
capital industry. Our paper yields two specific contributions. First, we analyze in a Continental European bank-based system the most important investment criteria identified by previous empirical literature. Second, we show that existing differences in the use of the investment criteria depend on the existence of asymmetric information problems associated to specific characteristics of the venture capital companies. Knowing what investment criteria are the most important for venture capitalists might help both entrepreneurs to elaborate better proposals, and venture capitalists to improve their decision process and achieve better survival rates.


Full Text: PDF DOI: 10.5539/ijbm.v7n6p81

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This work is licensed under a Creative Commons Attribution 3.0 License.

International Journal of Business and Management   ISSN 1833-3850 (Print)   ISSN 1833-8119 (Online)

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