Buy local?
Subtitle: the geography of successful and unsuccessful venture capital expansion
By: Henry Chen, Paul Gompers, Anna Kovner, Josh Lerner
Contributors: Harvard Business School
Series: Working paper / Harvard Business School -- 09-143; Working paper (Harvard Business School) -- 09-143.
Publisher: Harvard Business School
Published: 2009
Place of publication: [Boston]
Language: eng
Number of pages: 41
Description: We document geographic concentration by both venture capital firms and venture capital-financed companies in three cities - San Francisco, Boston, and New York. We find that firms open new satellite offices based on the success rate of venture capital-backed investments in an area. Geography is also significantly related to outcomes. Venture capital firms based in locales that are venture capital centers outperform, regardless of the stage of the investment. Ironically, this outperformance arises from outsized performance outside of the venture capital firms' office locations, including in peripheral locations. Outperformance of non-local investments suggests that policy makers in regions without local venture capitalists might want to mitigate costs associated with established venture capitalists investing in their geographies rather than encouraging the establishment of new venture capital firms.
Notes: "June 2009"--p. [1].

Includes bibliographical references.