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Miona Milosevic, Jacqueline Fendt, Venture capital and its French exception: Explaining performance through human capital, policy and institutional failures, Science and Public Policy, Volume 43, Issue 5, October 2016, Pages 660–679, https://doi.org/10.1093/scipol/scv068
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We examine the venture capital (VC) industry and its French exception. While it is evident that French funds underperform in comparison to both their Anglo-Saxon counterparts and their immediate neighboring countries, the determinants of this phenomenon are unclear. Through an exploratory, inductive study among French expert venture capitalists we conceptualize VC agency as a process of construction of expertise through deliberate practice. We show how the specificities of the French VC market, first, the dominance of banking/finance professionals, grounded in the industry’s banking antecedents; and second, the prevailing public funding and numerous front-end tax incentives, hamper this process of deliberate practice and act as mutually reinforcing levers of inefficiency. We discuss the implications for scholars, practitioners and policy-makers.