Impact investmentsa study on the value-add that European impact startups seek from their investors

Abstract

This research paper investigates the value-add that European impact start ups seek from their investors beyond the provision of financial capital. In explicit, the experiences and expectations of impact entrepreneurs towards investors are examined through a quantitative study that evaluates the criteria by which the surveyed founders chose their investors pre-investment as well as the value-add that the founders considered most relevant post-investment. It is found that European impact founders regard personal fit with their VCs as the most important criterion by which they choose their investor. Post-investment, fundraising support was mentioned most frequently as the value-add from investors that contributed most to a venture’s growth. Besides, the results vary among start ups based on both founder specific and company specific characteristics such as the founder’s experience level, stage of the company, and business model. Overall, 79% of surveyed founders are satisfied or very satisfied with the value-add they receive from their investors.