Venture Capital as Dynamic Regulation of Disruptive Innovation
Wulf A. Kaal, Erik P.M. Vermeulen · 2016
Disruptive innovation creates increasing regulatory challenges. Venture capital’s assessment of innovative products, businesses, and initiatives generates highly relevant institution- and industry-specific decentralized information on innovation trends. Using a dataset comprising over 75,000 venture capital deals with over 35,000 companies in the United States from 2005 to 2015, we show how venture capitalists’ innovation driven finance allocation can provide feedback on innovation trends and associated risks for rulemakers, optimize the timing of regulation, and support anticipatory rulemaking.
Cite: Wulf A. Kaal, Erik P.M. Vermeulen, Venture Capital as Dynamic Regulation of Disruptive Innovation (2016). SSRN: https://ssrn.com/abstract=2740477. https://doi.org/10.2139/ssrn.2740477
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