The Prioritization of Criteria Affecting the Evaluation of Venture Capital Projects

Document Type : Original Article

Authors

Tarbiat Modares University  

Abstract

The evaluation of new idea projects is one of the most challenging issues in the relationship between entrepreneurs and venture capitalists. The aim of this paper is to identify and rank important criteria used by venture capitalists in the evaluation of new idea projects. To do so, the required data is gathered by a questionnaire. The data analysis is performed using partial least squares method, a subsidiary to structural equations modeling. The results show that the financial considerations of product have the highest priority and personality traits and the ability of entrepreneur respectively rank the next. Also, 24 of 46 basic criteria have reached the final stage of analysis and are recommended to be used in the screening phase. The results are validated for 4 new ideas projects. The accuracy of ranking these projects is 83 percent based on the results of this study.

Keywords


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