What is a successful startup? : Exploring venture capitals’ impact on entrepreneurs’ view of success

Abstract: This paper explores whether venture capital investment in start-up companies changes entrepreneurs’ view of success and if so, how and why it changes. The study aims to contribute to the relatively limited research in the field of entrepreneurship research focused on entrepreneurs’ subjective view of success. Furthermore, we want to make a first contribution in exploring if, how and why venture capitalists impact entrepreneurs view of success. Our data is obtained through semi-structured interviews with first-time entrepreneurs who recently got venture capital funding. Through analysis of the interviews we explore how entrepreneurs look at success before and after venture capital funding. We find that venture capital involvement has an impact on the entrepreneurs’ view of success. It changes from a more personal and interpersonal favoured view, to a more financial sided view, closer to the venture capitalists’ view of success. This change comes gradually and originates from entrepreneurs learning from- and imitation of the venture capitalists. This is both due to first-time entrepreneurs in general lacking business knowledge and know-how that the venture capital has as well as venture capital having a powerful position in the ventures and are able to have influence on decisions and goals. Identifying indicators of entrepreneurial success is problematic due to the many different dimensions of the concept. Our study focuses on a small group of entrepreneurs in one geographical area and is not able to capture potential cultural, geographical and personal differences. Nonetheless, we believe that our study makes a first attempt in exploring stakeholder influence on entrepreneurial success and encourage further research in the field.