# kaal:claim:3962614-020

**Claim.** Alternative early round funding mechanisms are not necessarily more successful than VCs in early round technology investing, because they tend to act out of intuition and personal experience whereas VCs use a primarily data driven approach to investment decisions and portfolio company evaluation.

**Type.** failure  **Support.** argued

**Holds when.**

- early round technology investing

**Source quote.**

> Whereas alternative early round funding mechanisms often tend to act out of intuition and personal experience, VC typically use a primarily data driven approach to investment decisions and portfolio company evaluation and supervision.

**From.** Wulf A. Kaal, *REPUTATION AS CAPITAL – How Decentralized Autonomous Organizations Address Shortcomings in the Ventu* (2021), III. Alternative Early Round Funding Mechanisms, page 13

**Cite as.** Wulf A. Kaal, REPUTATION AS CAPITAL – How Decentralized Autonomous Organizations Address Shortcomings in the Ventu (2021). SSRN: https://ssrn.com/abstract=3962614

**Verify.** sha256 of source PDF `c6e202e77fd08db801f932774026458b94e5d103abf30cb1189fe6a1c5edf391` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20-%202021%20-%20REPUTATION%20AS%20CAPITAL%20%E2%80%93%20How%20Decentralized%20Autonomous%20Organizations%20Address%20Shortcomings%20in%20the%20Ventu.pdf

**Failure mode.** Alternative funder idiosyncrasy  (family: cold-start-and-bootstrapping)

**Topics.** institutional-design

**Keywords.** business-angels, intuition, data-driven-investing, early-round-funding

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