Determinants of startup´s value according to venture capitalists

Abstract

PURPOSE: The objective of this study is to analyze the existing literature and identify knowledge gaps about the main value determinants of startups – according to venture capitalists’ perspective.

DESIGN/METHODOLOGY/APPROACH: This objective is verified through a bibliometric analysis and systematic review, which execution considers the use of RStudio, Biblioshiny and Rank Words softwares. The final sample consists of 184 articles, obtained from the Web of Science and Scopus databases. Furthermore, this study also verifies the main bibliometric laws - Lotka (authors), Bradford (journals) and Zipf (keywords).

FINDINGS: There is a future research avenue related to the analysis of: i) financial determinants of startups’ value that are in more advanced stages – scale-up and mature – e.g. expenditure on research and development, sales growth, profitability, ii) types of venture capitalists as startups’ value determinants – e.g., crowdfunding, angel investor, mutual funds and iii) alternative methods of startups’ valuation – e.g., First Chicago, Scorecard, Venture capital, Berkus.

PRACTICAL IMPLICATIONS: The results of the study allow an approximation between the research topics of the academic community and the startup management, enabling a consistent evolution of this market segment.

ORIGINALITY/VALUE: The bibliometric analysis considers the verification of three main laws – Zipf, Bradford and Lotka. Furthermore, the systematic review is carried out through the codification of a (sub)categorization matrix. Moreover, the study also provides the analysis of the following aspects - not verified by other researches on the same topic: (i) stages of the startups as determinants of value for venture capitalists; (ii) geographical coverage between countries and (iii) mapping of the various types of venture capitalists.