Blurring firm boundaries: The role of venture capital in strategic alliances

Research output: Contribution to journalArticle

115 Citations (Scopus)

Abstract

This study documents a new value-added role of venture capitalists and addresses important questions about how resources are combined to create firms. As part of the nexus of contracts surrounding a firm, strategic alliances can be viewed as relational contracts that blur firm boundaries. This paper provides evidence that alliances are more frequent among companies sharing a common venture capitalist. The effect is concentrated in alliances in which contracting problems are more pronounced, consistent with venture capitalists utilizing informational and other advantages in providing resources to firms. Further, these alliances improve the probability of exit for venture-backed firms.

Original languageEnglish (US)
Pages (from-to)1137-1168
Number of pages32
JournalJournal of Finance
Volume63
Issue number3
DOIs
StatePublished - Jun 2008

Fingerprint

Firm boundaries
Strategic alliances
Venture capital
Alliances
Venture capitalists
Resources
Relational contracts
Venture
Contracting
Exit
Value added

ASJC Scopus subject areas

  • Finance
  • Accounting
  • Economics and Econometrics

Cite this

Blurring firm boundaries : The role of venture capital in strategic alliances. / Lindsey, Laura.

In: Journal of Finance, Vol. 63, No. 3, 06.2008, p. 1137-1168.

Research output: Contribution to journalArticle

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