Abstract

Prior research has established the existence of numerous disagreements and conflicts in the VC-entrepreneur relationship (Sapienza, 1989; 1992; Gomez-Mejia et al., 1990; Ehrlich et al., 1994) that may be spurred by both parties’ opportunistic behavior negatively influencing perception of procedural justice (Sapienza and Korsgaard, 1996; Busenitz et al., 1998) and venture profitability (Higashide and Birley, 2002). Previous studies have not investigated, though, how disagreements between VCs and CEOs and may affect CEOs’ behavioral intentions. This question is of great consequence since many ventures prefer to avoid VC financing as too expensive and risky (Amit et al., 1990). Therefore, VCs would be interested to know how CEOs might act in reaction to their perceived conflicts with VCs while CEOs certainly would like to find out how their peers react to perceived conflicts with VCs.

Share

COinS