Universität Bonn

Department of Economics

Juanita Gonzalez-Uribe - London School of Economics

"The Value-Add of Venture Capital Due-diligence: Information Frictions, Startup Growth, and Failed Fundraising Campaigns"


Most research investigating the prevalence of venture capital (VC) investors in innovation clusters focuses on VCs’ value-add to portfolio-companies. We explore the value-add of VCs beyond their portfolios, specifically through due-diligence: the multi-stage process that VCs use to assess companies for investment. We hypothesize that VC due-diligence helps entrepreneurs mitigate their information frictions. We test this hypothesis using data on nearly 2,000 applicants for funding to a seed fund that screens them for due-diligence by quasi-randomly assigning applicants to reviewers. We find supportive evidence that assignment to due-diligence leads to higher growth, potentially through productivity improvements rather than signaling effects.

Additional information:

  • Speaker: Juanita Gonzalez-Uribe
  • Time: Wednesday, 09.11.2022, 14:45 - 16:00
  • Location: Faculty Lounge, Room 0.036
  • Further links:
  • Organizer: Finance Group
  • Contact:

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