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Venture Capital Investment And Small Business Affiliation Rules: Why A Limited Exception Is Crucial To Economic Recovery Efforts, Jessica Tillipman, Damian Specht

GW Law Faculty Publications & Other Works

Small businesses and venture capital are a natural pair. While many small businesses are born of technical expertise and innovation, few are well financed. One of the reasons for this lack of financing is that small concerns are often viewed as risky investments. Small businesses are rarely led by experienced business people and, as many statistics demonstrate, are more likely than not to fail. Unlike their under financed counterparts, venture capital companies (“VCCs”) are well financed and what they lack in technical capability, they make up for in business acumen and financial wherewithal. Moreover, risky investments with large upsides are …