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Asia Pacific Journal of Management

04-07-2020

A neo-configurational institutional analysis of international venture capital attractiveness and performance: insights for Asia-Pacific

Authors: Amir Pezeshkan, Adam Smith, Stav Fainshmidt, Anil Nair

Published in: Asia Pacific Journal of Management | Issue 2/2022

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Abstract

Prior research suggests that market-supporting institutions are attractive to international venture capital (IVC), yet paradoxically VC firms increasingly invest in countries characterized by institutional weaknesses. In this study, we explore the institutional contexts that make countries attractive to IVC investment and favorable to IVC performance, thus illuminating the implied risk-reward tradeoffs in IVC firm location choice and ability to navigate institutional weaknesses. Utilizing fuzzy-set Qualitative Comparative Analysis (fsQCA), we find four distinct configurations of institutions associated with IVC attractiveness. Each configuration allows for some institutional weaknesses, enabling us to elaborate theory on institutional complementarities and substitutions that drive IVC investment. Further, we find that IVC firms have performed well even in countries with pervasive institutional weaknesses, suggesting that IVC firms may uniquely contribute to the success of new ventures in such institutional contexts. We discuss implications for theory and offer policy and managerial recommendations particularly relevant to IVC activity in the Asia-Pacific region.

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Appendix
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Footnotes
1
It should be noted that, when there is data contradicting these easy counterfactuals, the data always takes priority.
 
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Metadata
Title
A neo-configurational institutional analysis of international venture capital attractiveness and performance: insights for Asia-Pacific
Authors
Amir Pezeshkan
Adam Smith
Stav Fainshmidt
Anil Nair
Publication date
04-07-2020
Publisher
Springer US
Published in
Asia Pacific Journal of Management / Issue 2/2022
Print ISSN: 0217-4561
Electronic ISSN: 1572-9958
DOI
https://doi.org/10.1007/s10490-020-09727-9