This research examines the manner in which venture capitalists affect ventures’ performance. In particular the underline question is to understand whether venture capitalists select or create winners. To start answering this question we examined how the early-stage syndication strategy and post-investment activities affected separately and simultaneously ventures’ performance.

We hypothesised that early-stage syndication shall diminish the adverse selection problem due to the information sharing between the investors (Bygrave, 1987; Lerner, 1994) and hence increase the chances that the chosen venture be successful. We argued that the CEO replacement, unlike what was predicted by the agency theorists (i.e. Jensen & Meckling, 1976) is a means for VCs to inject missing managerial competences into the venture (Bruton et al., 2000; Wasserman, 2003) and the later the replacement is done, the less is the loss of the information advantage (Bygrave, 1987) hold by the CEO-founder, the more positive will be the impact of the replacement. We also hypothesised that the resource provision functions (Pfeffer & Salancik, 1978) will increase the venture’s performance. Finally, we postulated that the early-stage syndication will positively moderate the effect of the VC’s involvement if the value-added argument prevails (Brander et al., 2002) and negatively, if the VC behaves as a free-rider (Dimov & De Clerq, 2006) or the coordination costs among co-investors are too high to take decisions efficiently.