Publications
Publications
- 2025
- HBS Working Paper Series
Learning by Investing: Entrepreneurial Spillovers from Venture Capital
By: Josh Lerner, Jinlin Li and Tong Liu
Abstract
This paper studies how investing in venture capital (VC) affects the entrepreneurial outcomes of individual limited partners (LPs). Using comprehensive administrative data on entrepreneurial activities and VC fundraising and investments in China, we find that after investing in a successfully launched VC fund, individual LPs create significantly more ventures than do LPs in funds that failed to launch. These new ventures tend to be high-tech firms with better employment outcomes and more patent activity. Our results suggest that venture investments are a channel through which individual LPs learn.
Keywords
Limited Partners; Private Capital; Partners and Partnerships; Entrepreneurship; Venture Capital; Investment; China
Citation
Lerner, Josh, Jinlin Li, and Tong Liu. "Learning by Investing: Entrepreneurial Spillovers from Venture Capital." Harvard Business School Working Paper, No. 24-029, November 2023. (Revised November 2025. Revise and resubmit, Review of Financial Studies.)