Abstract
This study investigates the effect of historical military conflict (between the home countries of venture capital (VC) firms and portfolio companies) on the performance of cross-border VC investments. Using exhaustive data on global cross-border investments during 1986–2017, we find that adverse memories imprinted by historical military conflict have a negative effect on cross-border performance as measured by internal rate of return and public market equivalent. We show that nation-dyadic (i.e. political affinity) and ownership control strategy (i.e. board seat and syndication)-related contingencies moderate the relationship between historical military conflict and cross-border performance. Collectively, our findings shed light on the presence of intergroup interaction challenges and mistrust when investing in cross-border VC deals and demonstrate channels to mitigate their adverse effects.
| Original language | English |
|---|---|
| Pages (from-to) | 992-1013 |
| Number of pages | 22 |
| Journal | British Journal of Management |
| Volume | 35 |
| Issue number | 2 |
| Early online date | 14 Jul 2023 |
| DOIs | |
| Publication status | Published - 8 Apr 2024 |
Bibliographical note
Publisher Copyright:© 2023 The Authors. British Journal of Management published by John Wiley & Sons Ltd on behalf of British Academy of Management.