IDEAS home Printed from https://ideas.repec.org/a/spr/intemj/v19y2023i2d10.1007_s11365-023-00837-6.html
   My bibliography  Save this article

Similarity is not everything: the influence of personal characteristics of entrepreneurs and investors on their fit

Author

Listed:
  • Caroline Tarillon

    (Univ. Grenoble Alpes, Grenoble INP, CERAG)

  • Han Yu

    (Univ. Grenoble Alpes, Grenoble INP, CERAG)

  • Ludivine Adla

    (Univ. Grenoble Alpes, Grenoble INP, CERAG)

  • Elodie Manthé

    (Université Savoie Mont-Blanc, IUT Annecy, IREGE)

  • Geoffroy Enjolras

    (Univ. Grenoble Alpes, Grenoble INP, CERAG)

Abstract

New technology-based firms (NTBFs) currently represent a strong growth lever for the economy, but they face numerous obstacles. Achieving financing goals is a key element in securing sufficient resources for growth. To do so, entrepreneurs need to build high-quality relationships with investors. Through the proposition of an integrative model thanks to the upper echelon theory (UET), our research studies how personal characteristics of entrepreneurs and investors influence their fit. In an original qualitative approach, we interviewed nine pairs of entrepreneurs and investors. To complement findings in entrepreneur/investor relationship field, we demonstrate that similarity is not everything and that complementary personality traits, aligned values and past experience which give confidence are crucial antecedents of their fit. We also complement past research by showing that those personal characteristics are more important in the first stages of pre-financing process, from the encounter stage, even if they need to be taken into account throughout the process via the construction of the interpersonal relationship between the two actors.

Suggested Citation

  • Caroline Tarillon & Han Yu & Ludivine Adla & Elodie Manthé & Geoffroy Enjolras, 2023. "Similarity is not everything: the influence of personal characteristics of entrepreneurs and investors on their fit," International Entrepreneurship and Management Journal, Springer, vol. 19(2), pages 709-732, June.
    • Handle: RePEc:spr:intemj:v:19:y:2023:i:2:d:10.1007_s11365-023-00837-6
    DOI: 10.1007/s11365-023-00837-6
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11365-023-00837-6
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s11365-023-00837-6?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Darek Klonowski, 2010. "The Venture Capital Investment Process," Palgrave Macmillan Books, Palgrave Macmillan, number 978-0-230-11007-6.
    2. Catherine Casamatta & Carole Haritchabalet, 2014. "Dealing with Venture Capitalists: Shopping Around or Exclusive Negotiation," Review of Finance, European Finance Association, vol. 18(5), pages 1743-1773.
    3. Tyzoon T. Tyebjee & Albert V. Bruno, 1984. "A Model of Venture Capitalist Investment Activity," Management Science, INFORMS, vol. 30(9), pages 1051-1066, September.
    4. Joern H. Block & Massimo G. Colombo & Douglas J. Cumming & Silvio Vismara, 2018. "New players in entrepreneurial finance and why they are there," Small Business Economics, Springer, vol. 50(2), pages 239-250, February.
    5. Warren Boeker & Robert Wiltbank, 2005. "New Venture Evolution and Managerial Capabilities," Organization Science, INFORMS, vol. 16(2), pages 123-133, April.
    6. Laurence Cohen & Peter Wirtz, 2022. "Decision-making style in entrepreneurial finance and growth," Small Business Economics, Springer, vol. 59(1), pages 183-210, June.
    7. Daniel Appelhoff & René Mauer & Veroniek Collewaert & Malte Brettel, 2016. "The conflict potential of the entrepreneur’s decision-making style in the entrepreneur-investor relationship," International Entrepreneurship and Management Journal, Springer, vol. 12(2), pages 601-623, June.
    8. Swati Panda, 2018. "Adequacy of agency theory in explaining the venture capitalist-entrepreneur relationship: a firm life-cycle perspective," International Journal of Entrepreneurship and Small Business, Inderscience Enterprises Ltd, vol. 34(3), pages 309-329.
    9. Brett A. White & John Dumay, 2017. "Business angels: a research review and new agenda," Venture Capital, Taylor & Francis Journals, vol. 19(3), pages 183-216, July.
    10. Wentao Gu & Xuzheng Qian & Junpeng Lu, 2018. "Venture capital and entrepreneurship: a conceptual model and research suggestions," International Entrepreneurship and Management Journal, Springer, vol. 14(1), pages 35-50, March.
    11. Sapienza, Harry J., 1992. "When do venture capitalists add value?," Journal of Business Venturing, Elsevier, vol. 7(1), pages 9-27, January.
    12. Jeaneth Johansson & Malin Malmström & Joakim Wincent & Vinit Parida, 2021. "How individual cognitions overshadow regulations and group norms: a study of government venture capital decisions," Small Business Economics, Springer, vol. 56(2), pages 857-876, February.
    13. Alexandra Moritz & Walter Diegel & Joern Block & Christian Fisch, 2022. "VC investors’ venture screening: the role of the decision maker’s education and experience," Journal of Business Economics, Springer, vol. 92(1), pages 27-63, January.
    14. Darek Klonowski, 2010. "An Overview of the Venture Capital Investment Process," Palgrave Macmillan Books, in: The Venture Capital Investment Process, chapter 0, pages 25-54, Palgrave Macmillan.
    15. Frances M Amatucci & Jeffrey E Sohl, 2004. "Women entrepreneurs securing business angel financing: tales from the field," Venture Capital, Taylor & Francis Journals, vol. 6(2-3), pages 181-196, April.
    16. Josh Lerner & Ramana Nanda, 2020. "Venture Capital's Role in Financing Innovation: What We Know and How Much We Still Need to Learn," Journal of Economic Perspectives, American Economic Association, vol. 34(3), pages 237-261, Summer.
    17. Jensen, Michael C. & Meckling, William H., 1976. "Theory of the firm: Managerial behavior, agency costs and ownership structure," Journal of Financial Economics, Elsevier, vol. 3(4), pages 305-360, October.
    18. Shepherd, Dean A. & Armstrong, Michael J. & Levesque, Moren, 2005. "Allocation of attention within venture capital firms," European Journal of Operational Research, Elsevier, vol. 163(2), pages 545-564, June.
    19. Evan J. Douglas & Martin Carlsson-Wall & Tomas Hjelström, 2014. "Negotiating equity share and management control of the entrepreneurial new venture," Venture Capital, Taylor & Francis Journals, vol. 16(4), pages 287-307, October.
    20. Gabriele Pellegrino, 2018. "Barriers to innovation in young and mature firms," Journal of Evolutionary Economics, Springer, vol. 28(1), pages 181-206, January.
    21. R. C. Sweeting, 1991. "Uk Venture Capital Funds And The Funding Of New Technology‐Based Businesses: Process And Relationships," Journal of Management Studies, Wiley Blackwell, vol. 28(6), pages 601-622, November.
    22. Mark Van Osnabrugge, 2000. "A comparison of business angel and venture capitalist investment procedures: An agency theory-based analysis," Venture Capital, Taylor & Francis Journals, vol. 2(2), pages 91-109, April.
    23. Shane, Scott & Drover, Will & Clingingsmith, David & Cerf, Moran, 2020. "Founder passion, neural engagement and informal investor interest in startup pitches: An fMRI study," Journal of Business Venturing, Elsevier, vol. 35(4).
    24. Scott Latham & Steven F. Tello, 2016. "Examining Entrepreneurs' Presentation Effectiveness in Generating Stakeholder Interest: Observations From the Medical Device Industry," Journal of Small Business Management, Taylor & Francis Journals, vol. 54(1), pages 85-101, January.
    25. Jorge Silva, 2004. "Venture capitalists' decision-making in small equity markets: a case study using participant observation," Venture Capital, Taylor & Francis Journals, vol. 6(2-3), pages 125-145, February.
    26. Catherine Casamatta & Carole Haritchabalet, 2014. "Dealing with privately informed venture capitalists: shopping around or exclusive negotiation," Post-Print hal-01881905, HAL.
    27. Jonathan D. Arthurs & Lowell W. Busenitz, 2003. "The Boundaries and Limitations of Agency Theory and Stewardship Theory in the Venture Capitalist/Entrepreneur Relationship," Entrepreneurship Theory and Practice, , vol. 28(2), pages 145-162, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Manuel Kaiser & Andreas Kuckertz, 2025. "Emotions and entrepreneurial finance: Analysis of venture capitalists’ and business angels’ digital footprints on Twitter," International Entrepreneurship and Management Journal, Springer, vol. 21(1), pages 1-29, December.
    2. Rafał Morawczyński, 2020. "Venture Capitalists’ Investment Criteria in Poland: Entrepreneurial Opportunities, Entrepreneurs, and Founding Teams," Administrative Sciences, MDPI, vol. 10(4), pages 1-30, October.
    3. Rosenbusch, Nina & Brinckmann, Jan & Müller, Verena, 2013. "Does acquiring venture capital pay off for the funded firms? A meta-analysis on the relationship between venture capital investment and funded firm financial performance," Journal of Business Venturing, Elsevier, vol. 28(3), pages 335-353.
    4. Jonathan D. Arthurs & Lowell W. Busenitz, 2003. "The Boundaries and Limitations of Agency Theory and Stewardship Theory in the Venture Capitalist/Entrepreneur Relationship," Entrepreneurship Theory and Practice, , vol. 28(2), pages 145-162, March.
    5. Douglas Cumming & Satish Kumar & Weng Marc Lim & Nitesh Pandey, 2023. "Mapping the venture capital and private equity research: a bibliometric review and future research agenda," Small Business Economics, Springer, vol. 61(1), pages 173-221, June.
    6. Johannes Wallmeroth & Peter Wirtz & Alexander Peter Groh, 2017. "Institutional Seed Financing, Angel Financing, and Crowdfunding of Entrepreneurial Ventures: A Literature Review," Working Papers hal-01527999, HAL.
    7. Lefebvre, Vincent & Certhoux, Gilles & Radu-Lefebvre, Miruna, 2022. "Sustaining trust to cross the Valley of Death: A retrospective study of business angels’ investment and reinvestment decisions," Technovation, Elsevier, vol. 109(C).
    8. Volodymyr Babich & Simone Marinesi & Gerry Tsoukalas, 2021. "Does Crowdfunding Benefit Entrepreneurs and Venture Capital Investors?," Manufacturing & Service Operations Management, INFORMS, vol. 23(2), pages 508-524, March.
    9. Simone Aresu & Luigi Rombi & Andrea Cardia, 2019. "Management accounting systems in venture capital-backed start-up companies," MANAGEMENT CONTROL, FrancoAngeli Editore, vol. 2019(3), pages 35-58.
    10. Lohwasser, Todor S., 2020. "Meta-analyzing the relative performance of venture capital-backed firms," Discussion Papers of the Institute for Organisational Economics 4/2020, University of Münster, Institute for Organisational Economics.
    11. Markus Fitza & Thomas J. Dean, 2016. "How much do VCS and underwriters matter? A comparative investigation of venture capitalist and underwriter effects on IPO underpricing," Venture Capital, Taylor & Francis Journals, vol. 18(2), pages 95-114, April.
    12. Jeaneth Johansson & Malin Malmström & Joakim Wincent, 2021. "Sustainable Investments in Responsible SMEs: That’s What’s Distinguish Government VCs from Private VCs," JRFM, MDPI, vol. 14(1), pages 1-22, January.
    13. José Martí Pellón & Marina Balboa, 2003. "Characterisation Of The Reputation Of Private Equity Managers: Evidence In Spain," Working Papers. Serie EC 2003-16, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
    14. Denis A. Grégoire & Martin X. Noël & Richard Déry & Jean–Pierre Béchard, 2006. "Is There Conceptual Convergence in Entrepreneurship Research? A Co–Citation Analysis of Frontiers of Entrepreneurship Research, 1981–2004," Entrepreneurship Theory and Practice, , vol. 30(3), pages 333-373, May.
    15. Vincent Lefebvre & Gilles Certhoux & Miruna Radu-Lefebvre, 2022. "Sustaining trust to cross the Valley of Death: A retrospective study of business angels’ investment and reinvestment decisions," Post-Print hal-03545529, HAL.
    16. Nirmalkumar Singh Moirangthem & Barnali Nag, 2024. "Value-added Activities of Venture Capitals in Entrepreneurial Finance: Evidence from the Growth of Flipkart," Asian Journal of Management Cases, , vol. 21(1), pages 57-68, March.
    17. Gilles Certhoux & Alexandre Perrin, 2013. "Business Angels' practices in the screening stage: A study of knowledge transfer to the entrepreneur," Post-Print hal-00853184, HAL.
    18. Drover, Will & Wood, Matthew S. & Fassin, Yves, 2014. "Take the money or run? Investors' ethical reputation and entrepreneurs' willingness to partner," Journal of Business Venturing, Elsevier, vol. 29(6), pages 723-740.
    19. Claire Champenois & Michel Devigne & François-Régis Puyou, 2017. "Le rôle de l'organisation du travail des capital investisseurs dans la construction de relations interpersonnelles avec les entrepreneurs," Post-Print hal-01709993, HAL.
    20. JoAnne Yong–Kwan Lim & Lowell W. Busenitz & Laku Chidambaram, 2013. "New Venture Teams and the Quality of Business Opportunities Identified: Faultlines between Subgroups of Founders and Investors," Entrepreneurship Theory and Practice, , vol. 37(1), pages 47-67, January.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:intemj:v:19:y:2023:i:2:d:10.1007_s11365-023-00837-6. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.