We estimate the impact of venture capital (VC) contract terms on startup outcomes and the split of value between the entrepreneur and investor, accounting for endogenous selection via a novel dynamic search-and-matching model. The estimation uses a new, large data set of first financing rounds of startup companies. Consistent with efficient contracting theories, there is an optimal equity split between agents, which maximizes the probability of success. However, venture capitalists (VCs) use their bargaining power to receive more investor-friendly terms compared to the contract that maximizes startup values. Better VCs still benefit the startup and the entrepreneur due to their positive value creation. Counterfactuals show that reducing search frictions shifts the bargaining power to VCs and benefits them at the expense of entrepreneurs. The results show that the selection of agents into deals is a first-order factor to take into account in studies of contracting.

我们估计了风险投资 (VC) 合同条款对创业成果的影响以及企业家和投资者之间的价值分割，并通过一种新颖的动态搜索和匹配模型考虑了内生选择。该估计使用了初创公司第一轮融资的新的大型数据集。与有效合同理论一致，代理人之间存在最优的股权分配，这使成功的概率最大化。然而，与最大化创业价值的合同相比，风险资本家 (VC) 利用他们的议价能力来获得对投资者更友好的条款。由于其积极的价值创造，更好的风险投资仍然使初创公司和企业家受益。反事实表明，减少搜索摩擦会将议价能力转移到风险投资公司，并以牺牲企业家的利益为代价使他们受益。