Finance and Economics; Choosing co-investors; Friends without benefits;
Venture capitalists need to be ruthless about their relationships;
Even in a world of algorithmic trading and automated credit scoring, good financial decisions still depend on judgment. Choosing whom to invest alongside is particularly important in the uncertain world of venture capital, where many deals are syndicated, in order to share risk and information. Paul Gompers and Yuhai Xuan of Harvard Business School and Vladimir Mukharlyamov of Harvard University have put together a dataset of 3,500 early-stage investors in almost 12,000 deals to examine why specific pairs of investors are drawn to each other, and how that affects their financial performance.
就算在一个充斥着算法式交易和自动信誉评级的世界里，好的投资决策依然依靠判断力。选择与谁并肩作战，在一个充满着未知数的风投世界里显得尤其重要。许多风投项目都是联合投资以分散风险与共享信息。哈佛商学院Paul Gompers和Yuhai Xuan跟哈佛大学Vladimir Mukharlyamov整合了一个拥有3500名早期投资者，将近12,000个案例的资料库。该数据库式用以检验为什么特定组合的投资者能互相吸引，而这种关系如何影响他们的投资表现。
Investors clearly prefer partners with whom they have something in common. People who have worked at the same company are over 60% more likely to co-invest than those who have not. Investors who belong to the same ethnic minority, or studied at the same university, are around 20% more likely to pair up. The bias towards co-investors on measures of ability is weaker: investors with degrees from the best universities are just 9% more likely to get together.
Rapport is a poor basis for selecting partners. The authors examine investors' record at exiting investments through an initial public offering (IPO). An IPO is the holy grail for many start-ups, but the odds of success are 22% lower if a co-investing pair are alumni of the same university, and 18% lower if they share a past employer. By itself, ethnicity has no effect on investment success. In a pair, it is a different story. Co-investors from the same ethnic minority are 25% less likely to bring a portfolio company to an IPO (and the odds are still lower if the partners are East Asian). The data suggest that the poorer results of similar investors stem less from selecting bad companies, more from bad decisions taken together after the initial investment. It may be that a diversity of views helps investors to make better calls.
Partnerships based on ability, not similarity, tend to do better. If one investor of a pair has a degree from a leading university, this adds 9% to the possibility of their selected firms reaching an IPO; if the second does too, that adds a further 11%. Of course, such investors still have to find each other. Research led by Alexander Ljungqvist of New York University's Stern School of Business has shown that VC firms in influential network positions perform better, as they have more opportunity to take part in syndications. The moral seems to be that investors should make friends easily, but not invest for friendship's sake alone.