Econometric theory predicts that the precision of
our estimates will increase when we take into
account the rare-event nature of our dependent
variable. Indeed, in this model TEAM SIZE is
not significant. The results of Models 1–8 do
not depend upon the use of the rare-events logit
technique. To test Hypothesis 4b, in Model 10
we include TEAM COMPLETE and TEAM SPECIAL.
TEAM SIZE and TEAM COMPLETE are
highly correlated (see Table 5), and both coefficients
tend toward zero when included simultaneously.
Therefore, TEAM SIZE is excluded
from this regression. The results do not reveal
any significant patterns in the data. Moreover, a
Wald test that all variables in the regression are
jointly zero cannot be rejected (χ2(11) = 17.2;
p > χ2 = 0.10). Thus, we find no support for
Hypothesis 4b. Following the logic of Table 1,
these results suggest that (a) team size is an important
cue, but it is not learned from the planning
documents; and (b) team formalization is not an
important cue.
In Table 7, we report results of regressions testing
the remainder of the hypotheses. In each of
these models, we do not include revenue model
dummies. Wald tests failed to reject the hypothesis
that the revenue model dummies were jointly
insignificant for these subsamples.
In Model 11 we test Hypothesis 5. We find that
including information about educational attainment
does not predict VC outcomes. In Model 12
we find that the level of attainment (as proxied
by attaining a bachelor’s degree, an engineering
degree or a master’s of business administration)
does not predict funding. Hypothesis 5a is not
supported. Following Table 1, we conclude that
educational human capital is not an important cue
for VC decision making.
We test Hypothesis 6 in Model 13. We find that
including information on start-up experience is not
related to outcomes. However, we do find support
for Hypothesis 6a: the number of prior start-ups
with which team members were involved predicts
funding outcomes at the six percent level of significance
(Model 14; βENTREP EXP = 0.39, p > |z| =
0.06). Following the logic in Table 1, we interpret
this to imply that the number of prior start-ups is an
Econometric theory predicts that the precision of
our estimates will increase when we take into
account the rare-event nature of our dependent
variable. Indeed, in this model TEAM SIZE is
not significant. The results of Models 1–8 do
not depend upon the use of the rare-events logit
technique. To test Hypothesis 4b, in Model 10
we include TEAM COMPLETE and TEAM SPECIAL.
TEAM SIZE and TEAM COMPLETE are
highly correlated (see Table 5), and both coefficients
tend toward zero when included simultaneously.
Therefore, TEAM SIZE is excluded
from this regression. The results do not reveal
any significant patterns in the data. Moreover, a
Wald test that all variables in the regression are
jointly zero cannot be rejected (χ2(11) = 17.2;
p > χ2 = 0.10). Thus, we find no support for
Hypothesis 4b. Following the logic of Table 1,
these results suggest that (a) team size is an important
cue, but it is not learned from the planning
documents; and (b) team formalization is not an
important cue.
In Table 7, we report results of regressions testing
the remainder of the hypotheses. In each of
these models, we do not include revenue model
dummies. Wald tests failed to reject the hypothesis
that the revenue model dummies were jointly
insignificant for these subsamples.
In Model 11 we test Hypothesis 5. We find that
including information about educational attainment
does not predict VC outcomes. In Model 12
we find that the level of attainment (as proxied
by attaining a bachelor’s degree, an engineering
degree or a master’s of business administration)
does not predict funding. Hypothesis 5a is not
supported. Following Table 1, we conclude that
educational human capital is not an important cue
for VC decision making.
We test Hypothesis 6 in Model 13. We find that
including information on start-up experience is not
related to outcomes. However, we do find support
for Hypothesis 6a: the number of prior start-ups
with which team members were involved predicts
funding outcomes at the six percent level of significance
(Model 14; βENTREP EXP = 0.39, p > |z| =
0.06). Following the logic in Table 1, we interpret
this to imply that the number of prior start-ups is an
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