EVALUATING INNOVATION IN EQUITY INVESTMENT DECISIONS: INSIGHTS FROM VENTURE CAPITAL, PRIVATE EQUITY AND EQUITY FUND PERSPECTIVES
Tor Helge et al.
What the paper says
This study investigates how different types of investors — Venture Capitalists (VC), Private Equity (PE) investors, and Equity Fund (EF) managers — evaluate and prioritise innovation capabilities in their investment decisions. Contrary to initial assumptions, EF managers display varied approaches to valuing innovation, with differences rooted in investment strategy and risk tolerance. The findings reveal that VC investors prioritise innovation as central to their investment criteria, relying on qualitative indicators. In contrast, PE investors and EF managers view innovation as a component among broader financial metrics, often using historical and quantitative data. The research highlights significant variations in how investors utilise innovation, shaped by their risk appetites and strategic goals, offering insights not extensively explored in previous literature. This study contributes to understanding the nuanced role of innovation across investor types, suggesting avenues for further research into broader cultural and demographic impacts.
1 citation
Evidence weight
Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40
| F · citation impact | 0.16 × 0.4 = 0.06 |
| M · momentum | 0.53 × 0.15 = 0.08 |
| V · venue signal | 0.50 × 0.05 = 0.03 |
| R · text relevance † | 0.50 × 0.4 = 0.20 |
† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.