Abstract

Recognizing venture capital as a crucial source of funds for life science start-ups, this review paper focuses on the academic literature on venture capitalists’ decision-making process on granting funding to early-stage, high-tech ventures. This review identified the following three issues: First, despite three dominant factors in venture capitalists’ decision-making process, which are identified to be the human, technological and financial aspects of the potential start-up, a great variety of further factors exists and generalization to a great extent is difficult. Secondly, little research has been conducted in Europe and little research employed inductive, qualitative methods. Thirdly, the latest study focusing on a ranking of the importance of decision-making factors for venture capitalists lies 29 years in the past and has been conducted with a North-American sample, leaving a gap for future research in Europe.

Keywords: Decision-making, Early stage venture capital, High-tech entrepreneurs, High-tech firms, Life sciences, Venture capital.