The Public Venture Capital Challenge: The Australian Case

40 Pages Posted: 7 Nov 2007

See all articles by Brian Watson

Brian Watson

Georgica Associates Pty Limited

Josh Lerner

Harvard Business School - Finance Unit; Harvard University - Entrepreneurial Management Unit; National Bureau of Economic Research (NBER); European Corporate Governance Institute (ECGI); Harvard University - Private Capital Research Institute

Date Written: June 30, 2007

Abstract

The appropriate role of the public sector in fomenting venture capital activity remains highly controversial. While dynamic new venture markets in such nations as Israel and India have been catalyzed by public interventions, there are also many examples world-wide of failed public sector efforts to promote venture capital activity. This paper describes one effort to avoid the pitfalls of the past, and design a thoughtful set of policies to encourage venture capital activity.

In particular, this paper describes the experience of the Australian government between 2004 and 2006 in studying its venture capital market and how to promote it. After reviewing the more general case for a public role in promoting venture activity and the possible pitfalls that may result, we turn to understanding the market as it existed in Australia in 2004. We then outline the key policies that were discussed and adopted.

Keywords: private equity, entrepreneurship, public policy

JEL Classification: G24, H23

Suggested Citation

Watson, Brian and Lerner, Josh, The Public Venture Capital Challenge: The Australian Case (June 30, 2007). Available at SSRN: https://ssrn.com/abstract=1027445 or http://dx.doi.org/10.2139/ssrn.1027445

Brian Watson

Georgica Associates Pty Limited ( email )

Level 8, 90 Collins Street
Melbourne, Vic 3000
Australia

Josh Lerner (Contact Author)

Harvard Business School - Finance Unit ( email )

Boston, MA 02163
United States
617-495-6065 (Phone)
617-496-7357 (Fax)

HOME PAGE: http://www.people.hbs.edu/jlerner/

Harvard University - Entrepreneurial Management Unit

Cambridge, MA 02163
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

Harvard University - Private Capital Research Institute ( email )

114 Western Ave
Allston, MA 02134
United States

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