The "Double Market" approach in venture capital and private equity activitythe case of Europe

Résumé

This paper aims to contribute to the understanding of the factors that determine fundraising and investment in the private equity market in Europe. These are analysed separately, since the lags faced in this activity determine the existence of two separate markets. As a result, private equity institutions deal with different agents, namely investors (fundraising) and firms (investment), whose link with the market is affected by different determinants. The results show that liquidity and the size of the local market are the main factors determining fundraising whereas liquidity and research and development expenditure determine investments in early stage firms.