Comparative analysis of venture capitalists investment criteria: a case from China and Pakistan / Shakeel Muhammad ... [et al.]

Muhammad, Shakeel and Li, Yaokuang and Wu, Juan and Ali, Gohar (2017) Comparative analysis of venture capitalists investment criteria: a case from China and Pakistan / Shakeel Muhammad ... [et al.]. Asia-Pacific Management Accounting Journal (APMAJ), 12 (2). pp. 201-234. ISSN 2550-1631

Abstract

This paper evaluates a method, intended by formal investors (venture capitalists) while making sound investment decisions and selecting those successful entrepreneurs in the emerging economies by identifying their basic investment criteria. The purpose is extended to compare the criteria used by venture capitalists of both countries along with the related risk profile faced by them. The online questionnaires were sent to the venture capitalists of both countries (selected from the official entities) which are followed up by the interview (face to face and electronic). It is found that venture capitalists of both countries act almost same while evaluating the individual criteria (entrepreneur’s personality and experience) and corporate criteria (Product and Market characteristics). In terms of institutional or environmental criteria, Pakistani VCs are more demanding then Chinese VCs due to the lack of support from the financial and legal institutions. Further, Pakistani VCs attracted by the environmental level risk like country and geographical risk whereas Chinese VCs concentrates on the socio-culture and trade risk. While the VCs of both countries react in the same way to the venture and team level risk. Investment is a multi-stage process. The researchers are encouraged to enhance the investment criteria along with the stages of investment (deal-origination, deal-structuring and due-diligence).

Metadata

Item Type: Article
Creators:
CreatorsID Num. / Email
Muhammad, ShakeelUNSPECIFIED
Li, YaokuangUNSPECIFIED
Wu, JuanUNSPECIFIED
Ali, GoharUNSPECIFIED
Subjects: H Social Sciences > HA Statistics > Theory and method of social science statistics
H Social Sciences > HB Economic Theory. Demography > Capital. Capitalism
Divisions: Universiti Teknologi MARA, Shah Alam > Accounting Research Institute (ARI)
Journal or Publication Title: Asia-Pacific Management Accounting Journal (APMAJ)
Journal: UiTM Journal > Asia-Pacific Management Accounting Journal (APMAJ)
ISSN: 2550-1631
Volume: 12
Number: 2
Page Range: pp. 201-234
Item ID: 29887
Uncontrolled Keywords: Venture capitalist, Investment criteria, Entrepreneurs
URI: http://ir.uitm.edu.my/id/eprint/29887

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