Ginés Hernández-Cánovas, Antonia Madrid-Guijarro and Howard Van Auken
Venture capital contracts and the institutional theory: differences between public and private Spanish venture capital firms
Institutions, Behaviors and Outcomes
Mª Camino Ramón-Llorens and Ginés Hernández-Cánovas
Mª Camino Ramón-Llorens and Ginés Hernández-Cánovas show, through analysis of a survey dataset of 41 Spanish venture capital firms (VCFs), that a large part of Spanish venture capital contracts are standard. However, when the authors study VCFs according to the public or private origin of the resources, they find that there is some heterogeneity in the design of contracts due to coercive pressure exerted by the government on public entities, with the private sector remaining the stronger in the application of standard terms. Their results contribute to shedding light on the design of financial contracts between entrepreneurial firms and their VC investors, to the benefit of policy makers, firms and venture capitalists.