West German Venture Capital Market: An Analysis of Its Market Structure and Economic Performance

The German venture capital market emerged in 1974 in a relative flurry of activity. Quickly, however, the novelty of this maveric form of financing wore off, as the number of market entrants stabilized in the mid-nineteen eighties. That which began as an unconventional source of managerial/technical know how and financial capital support for growth-oriented, dynamic, young enterprises and entrepreneurs has to a large extent gradually evolved into yet another not-so-venturesome equity source for market «imitators» rather than market «innovators». Some venture capital enterprises have, however, remained venturesome. What has caused this paradoxical development? Why has there been a major change in policy and dynamic orientation? This book uses techniques of industrial organization analysis to examine the changing structure of the German venture capital market in an attempt to answer these and other crucial political-economic questions.