Publications
Publications
- Journal of Economics & Management Strategy
Specialization and Success: Evidence from Venture Capital
By: Paul A. Gompers, Anna Kovner and Josh Lerner
Abstract
This paper examines how organizational structure affects behavior and outcomes, studying the performance of different types of venture capital organizations. We find a strong positive relationship between the degree of specialization by individual venture capitalists at a firm and its success. When the individual investment professionals are highly specialized themselves, the marginal effect of increasing overall firm specialization is much weaker. The poorer performance by generalists appears to be due to both an inefficient allocation of funding across industries and poor selection of investments within industries. Venture capital organizations with more experience tend to outperform those with less experience.
Keywords
Experience and Expertise; Venture Capital; Organizational Structure; Outcome or Result; Performance Effectiveness; Behavior; Financial Services Industry
Citation
Gompers, Paul A., Anna Kovner, and Josh Lerner. "Specialization and Success: Evidence from Venture Capital." Journal of Economics & Management Strategy 18, no. 3 (Fall 2009): 817–844.
About The Authors
