Autori
Colombo, Massimo G.
Butticè, Vincenzo
Rovelli, Paola

Titolo
Venture capital and the delegation of decision authority in startups: an exploratory study
Periodico
Economia e politica industriale
Anno: 2024 - Volume: 51 - Fascicolo: 4 - Pagina iniziale: 893 - Pagina finale: 923

We study the delegation of authority over strategic decisions in Startups and how it relates to venture capital (VC) investment through a mixed-methods study. We first show that Startups typically centralize decision authority. The extent of delegation is higher if Startups are VC-backed. In startups backed by corporate VC investors the aim is to leverage the unique knowledge possessed by entrepreneurial team members in a context characterized by low principal-principal agency costs. In those backed by independent VC investors, the increase in delegation is paired with the emergence of a polyarchy and decoupling between in the formal and real organizations. In this situation delegation may serve as a control mechanism aligning the actions of Startups with the interests of the VC investors.



SICI: 0391-2078(2024)51:4<893:VCATDO>2.0.ZU;2-J

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