Mixed Signals: Why investors may misjudge first time high technology founders

This paper seeks to explain an unexpected result of a previous quantitative study which suggested sub-optimal evaluation by investors of the human capital of first time high tech venture founders. A literature review revealed two possible reasons for this finding: biases/heuristics and signaling. Six investors across three countries (one venture capitalist and one business angel each from the US, UK and Israel) with experience in investing in early stage high technology ventures were interviewed using an identical semi-structured interview protocol. This research design is appropriate for research that seeks to reflect back unexpected findings of previous quantitative research on the subjects of research. Interviewees were first asked to state their own investment criteria, and then presented with the results of the quantitative study and asked for their views. Previous research suggesting a gap between in-use and espoused criteria, and extensive use of gut feeling in decision-making, was supported. Interviewees focused on harvest potential and de-emphasised measures of founder technology capability that predicted early survival and growth in the earlier study. The paper concludes by suggesting how investors might improve funding decisions in high tech ventures led by first-time entrepreneurs, noting the study's limitations and making recommendations for further research

Geographical co-location, social networks and inter-firm marketing co-operation : the case of the salmon industry

This study looks at the factors that influence the development of marketing co-operation among cluster-based firms. It examines data from SMEs operating within the salmon farming industry in two different regions: Scotland and Chile. Analyses indicate that informal social networks help explain the observed relationship between geographical proximity and inter-firm marketing co-operation, especially for firms located in peripheral rural communities. A theoretical model is proposed for further research in the field that, until recently, has been traditionally analysed only by economists. Practical implications are suggested for practitioners and policymaker

Instrumental Value Theory and the Human Capital of Entrepreneurs

Given the contribution of Schumpeterian entrepreneurship to technological progress and well-being, the accuracy of investment decisions by venture capitalists is a societal issue. Venture capitalists find the human capital of entrepreneurs difficult to assess. This paper employs instrumental value theory to assess the value of different human capital factors to the performance of new ventures. A meta-analysis of 29 previous empirical studies that examined the effect of founder's human capital on new venture performance suggested that instrumental value theory holds promise as a guide for research on entrepreneurs' human capital and new venture performance. It could also help venture capitalists to make better investment decisions, benefiting society in genera