# kaal:claim:2808132-041

**Claim.** The dominance of later stage venture capital investments could be read as risk-averse follow-on behavior, but venture capital funds are unlikely to make later stage investments unless portfolio companies substantially fulfilled their contractual performance obligations, which preserves the signal value of the data.

**Type.** mechanism  **Support.** argued

**Holds when.**

- later stage venture capital investments following earlier seed investments in the same company

**Source quote.**

> At the same time, however, VC funds are not likely to continue with later stage investments if contractual performance obligations/thresholds of their portfolio companies were not fulfilled to a substantial degree.

**From.** Wulf A. Kaal, Erik P.M. Vermeulen, *How to Regulate Disruptive Innovation - From Facts to Data* (2016), V.2 Industries Represented, page 36

**Cite as.** Wulf A. Kaal, Erik P.M. Vermeulen, How to Regulate Disruptive Innovation - From Facts to Data (2016). SSRN: https://ssrn.com/abstract=2808132

**Verify.** sha256 of source PDF `3515f2317ed9c1d33ae55d70467cdf1f6c4e350065ea6a887d5d7619599ad7d2` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20and%20Vermeulen%20-%202016%20-%20How%20to%20Regulate%20Disruptive%20Innovation%20-%20From%20Facts%20to%20Data.pdf

**Topics.** innovation

**Keywords.** later-stage-vc, signal-validity, portfolio-performance, venture-capital

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