Abstract:
Politicians and policy-makers recognise the importance of government participation in venture capital market development, but remain somewhat uncertain about the efficacy of different policy approaches (Lerner, 2009). Conceptualising and evaluating three dominant approaches, we offer three contributions towards venture capital market development. First, we define venture capital development; secondly we summarise main features of the Direct, Indirect and Timed approaches. Third, we evaluate each approach, finding the Timed approach the most comprehensive in regards to government’s role in venture capital market development. Also, we discuss the implications for decision-makers seeking to develop innovation ecosystems that support high-growth entrepreneurship, and suggest future research opportunities to analyse the Timed approach given its relative novelty as a venture capital model.