Research Paper 25: How to support cleantech start-ups? Lessons from European venture-capital deals.

In this paper, we analyze how different types of venture capital investments - private, direct and indirect public - influence the performance of cleantech start-ups in Europe. To this end, we have collected and processed a dataset on the institutional environment (public/indirect/private) of almost 15,000 investors in Europe, which we combine with data on portfolio companies and transactions from Preqin.

Two results stand out: First, public venture capital does not perform worse than private venture capital in a broad cross-national sample of European cleantech deals. This is in contrast to the existing literature, according to which state-backed VCs perform worse than their private counterparts. Moreover, we also find that there is no significant difference between direct and indirect state support of venture capital for cleantech investments. Second, state venture capital funds perform well when they specialize in cleantech investments and are well integrated into a network of other investors.