« The Attractiveness of Central Eastern European Countries for Venture Capital and Private Equity Investors »

Alexander Groh, GSCM – Montpellier Business School, France

Heinrich Liechtenstein, IESE Business School – Barcelona, Spain, and

Karsten Lieser, IESE Business School – Barcelona, Spain

Cette communication a reçu le 14 septembre 2007 le "Featured Paper Award" du Financial Services Institute, New York City. La distinction a été remise par le Professeur Dr. Igor Tomic, directeur du Financial Services Institute. Le working paper est téléchargeable sur http://papers.ssrn.com/sol3/papers.cfm?abstract_id=960505

Résumé

We address the attractiveness of Central Eastern European countries for VC/PE investors by the construction of a composite index. For the index’s composition we refer to the results of numerous prior research papers that investigate relevant parameters determining entrepreneurial activity and/or the engagements of institutional investors. We aggregate the index via five different methods and receive country rankings that vary only slightly, signaling a robust index calculation. We clearly identify six tier groups of attractiveness for all of our sample countries. We compare our index with the actual fundraising activities in the individual countries and reveal a reasonable correlation of both figures. The results highlight the strengths and weaknesses of the particular economies and provide guidelines for policy improvements and institutional investors’ country allocations.

[JEL codes: G23, G24, M13, O16, P34, P52]

Mots clefs: Venture Capital, Private Equity, Central Eastern Europe, Economic Transition