Venture Capital Redefined: The Economic, Political, and Social Impact of COVID on the VC Ecosystem

Description

This is the first comprehensive book that aims to understand how the novel coronavirus has impacted the venture capital industry. The analysis suggests that the industry has been undergoing profound changes. Specifically, the book assesses the short- and long-term impact of the economic, political, and social restrictions post COVID-response on different stakeholders in the venture capital ecosystem, including general partners (GPs), limited partners (LPs), and entrepreneurs. It also aims to answer the question whether current changes to the venture capital industry are likely to renew and promote its overhaul, or simply perpetuate its decline. The book will be of interest to students, academics, and researchers focusing on venture capital and private equity, entrepreneurial finance, entrepreneurship, and new venture creation as well as industry practitioners Preface The Book’s Structure The Contribution of This Book Future Research Acknowledgments Contents List of Figures List of Tables Part I Introduction: Venture Capital and Its External Environment in the Age of Covid 1 Venture Capital Prior to the Age of COVID Venture Capital: Definitions, Characteristics, and Publicity Characteristics of Venture Capital Venture Capital and Its Contribution to Entrepreneurial Development Venture Capital in the Mainstream Media Venture Capital and Entrepreneurial Development: Advantages and Disadvantages Conflicts Between Venture Capitalists and Entrepreneurs Historical Trends in the Venture Capital Industry Venture Capital Returns: A Historical Perspective Maturation of the Venture Capital Industry Summary of Venture Capital in a Pre-COVID Era Bibliography 2 Political Reactions and SocioEconomic Consequences of COVID: Implications for Venture Capital Political Reactions: The COVID-Response Lockdowns, Social-Distancing, and Masks Social and Human Implications of Restrictions Economic Consequences of Political COVID-Response Small Business in Crisis Socioeconomic Drifts Post COVID-Response: Implications for Venture Capital The Impact of Political, Social, and Economic Changes on the Venture Capital Industry Bibliography Part II The Venture Capital Industry Redefined 3 Transformations in the Venture Capital Ecosystem Post COVID-Response The General Structure of the Venture Capital Industry Re-Characterization of Venture Capital Relationships Venture Capitalists and Limited Partners Venture Capitalists and Entrepreneurs Venture Capitalists’ In-House Operations Post COVID-Response Venture Capital and Its Relations with Other Stakeholders The Venture Capital Industry Re-Imagined Global Consolidation of General Partners Global Pooling of Limited Partners The Futuristic Architecture of the Venture Capital Industry The Evolution of the Venture Capital Industry and Entrepreneurs Bibliography 4 Venture Capital Post COVID-Response: External Environmental Scanning and Investment Opportunities Undercurrents in the Peripheral Ecosystem Changes to Global Industrial Structures Alterations to Consumer Behavior Digitization of the Human Universe Home as the Center of Human Gravity Accelerated Deterioration of Physical and Mental Health Abolition of the Middle Class in Developed Countries The Squeeze of the Middle Class in the United States The Economic Distress of the Middle Class in Canada The Rise of the Middle Class in Emerging Markets Sectoral Orientation of Venture Capital in the Future The Future of Venture Capital Investment Opportunities in Specific Segments Sources of Venture Capital Transactions Post COVID-Response Bibliography 5 The Venture Capital Investment Process Redefined Disrupted Deal Generation Weak Deal Generation Post COVID-Response Compromised Deal Screening and Evaluation Compromised Due Diligence in Venture Capital More Adverse Selection Problems in Venture Capital Complexities in Financial Contracting in Venture Capital Additional Lopsided Agreements in Venture Capital Contracting Substantial Contractual Amendments to Buyout Transactions Challenging Value-Addition to Investee Firms Difficulties in Working with Portfolio Firms Exiting in Venture Capital Challenges in Venture Capital Exiting Bibliography 6 Degeneration of Future Venture Capital Performance Fund Formation and Venture Capital Performance The Cost of Venture Capital Services Carried Interest: Friend or Foe? Value-Chain Analysis of Venture Capital Performance Venture Capital Performance: History and Future Another Look at the Historical Performance of Venture Capital Longitudinal Impact and Venture Capital Performance in the Future Profiling General Partners and Financial Performance The Superior Venture Capitalist The Inferior Venture Capitalist Venture Capital Performance: Conclusions Bibliography Part III Entrepreneurship Redefined Post Covid-Response 7 COVID-Response and Entrepreneurship in Crisis Traditional Entrepreneurship Defined Entrepreneurship in the Age of Covid-Response Re-Evaluation of the Fundamentals for Entrepreneurial Success Magnification of Entrepreneurial Risks: The State Disruption of Relations in the Entrepreneurial Ecosystem Changes to Entrepreneurial Value Creation Entrepreneurial Survivability in the Age of COVID-Response Conclusions Bibliography 8 Amplified Challenges in Access to Entrepreneurial Finance in the Age of COVID-Response Financial Management of Entrepreneurial Firms Post COVID-Response Entrepreneurial Firms and Financial Management Post COVID-Response Problems with Access to Finance Post COVID-Response Problematic Access to Entrepreneurial Finance The Growth of Fintech as an Important Contributor of Entrepreneurial Finance Government Assistance Programs Post COVID-Response Conclusions: Access to Finance and the Financial Management of Entrepreneurial Firms in the Age of COVID-Response Bibliography Part VI Conclusions: Venture Capital in the Age of Covid 9 Descent or Revival of Venture Capital in the Age of COVID Four Pillars of the Global Venture Capital Ecosystem The Revival of Venture Capitalism Stimulation of the Entrepreneurial Ecosystem Possible Enhancements in the GP Market LPs as the Engine of Change in the Venture Capital Ecosystem Assistance from the State for the Venture Capital Ecosystem Evidence for the Descent of Venture Capital Prolonged State of Entrepreneurial Crisis A Spillover Effect of Entrepreneurial Challenges to GPs LPs’ Continued Dislocation Continued Negative Interference from the State Revival or Descent of the Industry in the Age of COVID The Possibility of Accelerated Evolution Within the Venture Capital Industry Venture Capital and Key Numbers Bibliography Index