Overcoming the Matthew Effect in Status Dominated Environments – a Configurational Analysis of Venture Capital Investments

Publikations-Art

Zeitschriftenbeitrag (peer-reviewed)

Autoren

Berger, Elisabeth S.C. / Kuckertz, Andreas

Erscheinungsjahr

2018

Veröffentlicht in

Credit and Capital Markets

Band/Volume

51/2

ISBN / ISSN / eISSN

2199-1235

DOI

10.3790/ccm.51.2.293

Seite (von - bis)

293–314

Entering status dominated environments as new entrant is a difficult endeavor. Accumulated
advantages go along with the tendency of incumbents to succeed, whereas entrants
are likely to lose (Matthew effect). This study examines what combination of deal resources
accumulated by venture capital partners lead to high deal performance in order to analyze
if new entrants can nonetheless overcome the burden of being new, i. e. having a low
status position and only weak ties with current actors in status dominated environments.
Our configurational analysis of 333 venture capital investments reveals opportunities for
entrants to succeed that go beyond joining forces with established actors. Our findings
contribute to research on interorganizational network formation and the strategic actions
new entrants on the VC market may take to be successful. Furthermore, the study sheds
light on the effect of syndicated opposed to single venture capitalist deals and suggests that
successful syndicates require a certain degree of homogeneity among the investors.