We examine the effect of a competitive supply of venture capital (VC) on the exits (initial public offering or mergers and acquisitions) of startups. We develop a matching model with double‐sided moral hazard, and identify a novel differential effect of VC competition on the success of startups. Using VC data, we find evidence for this differential effect. For example, when the VC market becomes more competitive (Herfindahl–Hirschman Index decreases by 50% from its mean of 0.08), the absolute likelihood of success increases by 2.8% for startups backed by less experienced VC firms, but it decreases by 3.6% for startups backed by the most experienced VC firms.

中文翻译：

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风险资本市场的竞争与创业公司的成功：理论与证据

我们研究了竞争性风险资本（VC）供应对初创企业退出（首次公开募股或并购）的影响。我们开发了一种具有双向道德风险的匹配模型，并确定了风险投资竞争对初创企业成功产生的新的不同影响。使用VC数据，我们找到了这种差异影响的证据。例如，当风险投资市场变得更具竞争力时（赫芬达尔·赫希曼指数从均值0.08下降了50％），由经验不足的风险投资公司支持的初创企业成功的绝对可能性增加了2.8％，但下降了3.6％适用于由经验最丰富的风险投资公司支持的初创公司。