Public private equity : an evaluation of public early stage risk capital initiatives in Norway

Abstract

Access to finance limits the ability to grow for many early stage ventures. To mitigate this limitation, the Norwegian State has initiated seed funds partly financed by public funds. The funds carried out many investments during the late 1990s and 2000s. This thesis describes and evaluates the performance of the "second wave" of seed funds established 2006 to 2008. The investments made by the seed funds are compared with investments made by other private equity investors during the same time period. Firstly, the thesis describes the characteristics of companies receiving investments. Secondly, it analyses the development in selected accounting metrics until (and including) 2012. Finally, regression analyses are used to identify the relationship between multiple variables and growth in revenue, operating income and wages. Among these variables is ownership by the second wave of seed funds. The regressions seek to establish a relationship between receiving investments from the seed funds and the subsequent development in revenues, operating income and wages.