What factors determine the failure in obtains venture capital?

Abstract

This paper has been an attempt to investigate the reasons underlying the lack of success in obtaining the venture capital financing. We did so from the demand perspective using a sample of 63 Portuguese nascent entrepreneurs that were not successful when, during the pre start-up phase of their innovative firms, they attempted to obtain VC financing. The main reasons cited for not obtaining VC financing were: 1) small size of the VC market in Portugal; 2) limited public policies to support VC participation; 3) lack of interest of the VCs in pre start-up phase investments; 4) unwillingness of VC suppliers to provide small amounts of capital.