EIF Working Paper 2021/070: The impact of VC on the exit and innovation outcomes of EIF-backed start-ups

The paper represents Vol. VI of the series “The European venture capital landscape: an EIF perspective” and looks at the impact of VC investments supported by the EIF during the years 2007 to 2014 on the exit and innovation outcomes of beneficiary start-ups. The analysis compares EIF-backed start-ups to a control group of non-VC-backed young and innovative companies, using novel indicators based on machine learning, satellite imagery analysis, and data on flight routes.

The results prove the positive effects of EIF-supported VC investments on the probability that start-ups experience favourable exit and innovation outcomes. EIF VC-invested start-ups were about three times more likely to participate in an M&A deal or experience an IPO than their non-VC invested counterfactuals. In addition, EIF VC contributed to a doubling of the probability to patent, compared to counterfactuals.

The EIF Working Papers are designed to make available to a wider readership selected topics and studies in relation to EIF´s business. The Working Papers are edited by EIF's Research & Market Analysis and are typically authored or co-authored by EIF staff or are written in cooperation with EIF.