Noam Wasserman

Revisiting the Strategy, Structure, and Performance Paradigm: The Case of Venture Capital

The strategy-structure-performance (SSP) paradigm has developed a central role within strategy research. However, recent critiques of the paradigm have called for research that uses more appropriate measures of strategy and structure, inductive methods that enable richer exploration of the paradigm, and extension of the paradigm to the expert-focused organizations that have grown in importance since the paradigm was first developed. This paper answers this call by integrating inductive methods with quantitative analysis of a unique panel data set of 317 professional services firms (PSFs) to find new measures of strategy and to understand their linkages to organizational structure within such firms. It shows how the core knowledge required for decision making and the coordination challenges in these firms drive their internal structures and that the degree of strategy-structure fit has important performance implications for those firms.

Patterns of VC Evolution: Comparing the Israeli and Indian Venture Capital Industries

Global opportunities for private equity investments abound. However, the venture capital industry, while highly sophisticated in much of the West, is in its infancy or early adolescence elsewhere in the world. This article examines and compares the evolution and current status of venture capital in Israel and India. Findings show that both countries are rich in brainpower, but that differing levels of political support, physical infrastructure, cultural learning, and other factors have contributed to radically different outcomes in their growing VC markets. While Israel and India can learn lessons from each others successes and failures, we in North American can also gain valuable insights into worldwide VC opportunities in these and similar countries.

Upside-down Venture Capitalists and the Transition Toward Pyramidal Firms: Inevitable Progression, or Failed Experiment?

The early-stage venture capital (VC) industry has long been dominated by small firms comprising senior venture capitalists and few junior staff. However, during the late 1990s, a group of firms changed their internal structures, adopting pyramidal structures and redesigning internal processes to leverage the efforts of junior staff. In doing so, they followed first-movers in other professional services industries that transitioned to pyramidal models in the 20th century. Has the recent industry downturn terminated the transition, or simply delayed it? This chapter analyzes the events that led the VC firms to transition, the barriers to doing so, and related issues affecting the industrys future.