Does Early Incubating Improve the Performance of Start-ups?: Evidence from TIPS in Korea
Recently, the government has been pursuing various policies to create new industries and jobs through the invigoration of start-ups. For the sustained growth of start-ups, it is necessary to look not only at the supply of risk capital but also at policies for venture capital firms that nurture and foster start-ups. The purpose of this study is to estimate the effects of the nurturing and fostering role of risk capital, such as mentorship on the performance of start-ups, and to do this we analyzed the effects, as a newly introduced form of venture capital, of mentoring by an accelerator and investor ties on the performance outcomes of start-ups. We find that mentoring and investor ties for start-up enterprises positively influence follow-up investment in start-ups. In addition, this study finds that with a younger CEO of a start-up, it is more likely that the performance of the start-up will improve. Meanwhile, when examining increases in employment as a measure of the business performance of start-ups, mentoring and investor ties are found to have a positive effect on the increase of employment at start-ups. These results suggest that there is a need to promote policies that strengthen the mentoring role of venture capital in Korea's equity finance policies and in the government's SME support policies.
Year of publication: |
2018
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Authors: | Koo, Ja Hyun |
Published in: |
KDI Journal of Economic Policy. - Sejong : Korea Development Institute (KDI), ISSN 2586-4130. - Vol. 40.2018, 2, p. 75-96
|
Publisher: |
Sejong : Korea Development Institute (KDI) |
Subject: | Accelerator | Venture Capital | Business Incubator | Start-up | TIPS (Tech Incubator Program for Start-ups) |
Saved in:
freely available
Type of publication: | Article |
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Type of publication (narrower categories): | Article |
Language: | English |
Other identifiers: | 10.23895/kdijep.2018.40.2.75 [DOI] hdl:10419/200824 [Handle] RePEc:zbw:kdijep:200824 [RePEc] |
Classification: | G24 - Investment Banking; Venture Capital; Brokerage ; G32 - Financing Policy; Capital and Ownership Structure |
Source: |
Persistent link: https://www.econbiz.de/10012034832
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