Investor Configuration and the Venture-Financing Ladder: Regional Heterogeneity Across Entrepreneurial Ecosystems

Abstract

How does a startup’s first financing round involving a given investor configuration affect its subsequent progression along the venture-financing ladder, and how does that effect vary across entrepreneurial ecosystems? We combine PitchBook records for 56,075 startups, 101,065 financing transactions, and 57,342 investors in 27 countries and seven regions with chief-executive characteristics recovered through SignalHire. We evaluate four investor configurations in separate treatment-specific designs: global-only venture capital, regional-only venture capital, mixed regional-global venture-capital syndicates, and public startup programs. The principal estimator is a region-specific staggered-adoption difference-in-differences (DID) design using a doubly robust score. The effects of a given investor configuration vary substantially across ecosystems. Within the global-only and mixed-syndicate designs, several of the larger cumulative gains in follow-on access, stage progression, and financing volume occur in Africa, Latin America and the Caribbean, and the Middle East. Within the regional-only design, access effects are widespread, while effects on advanced stages and financing scale are more pronounced in deeper ecosystems, particularly Asia and North America. Public-program exposure also translates more consistently into later-stage financing and larger capital volumes where beneficiaries can connect to developed private capital markets. These patterns are consistent with international capital and networks substituting for locally scarce resources, while regional and public finance complement downstream ecosystem capabilities.