INVESTIGATING INVESTOR-INVESTEE RELATIONS
This chapter develops the core set of ideas, drawn from the literature of economics, accounting and finance, which underpin the research agenda on which this book is based. Building on this, instruments were designed to confront empirical evidence with the propositions suggested by this agenda. These propositions focus upon the nature, operation and significance of the relationship between a group of specialized funders and a specific type of unquoted company. The funders are venture capital investors (VCIs), and the venture capital fund itself is sometimes identified as the investor. The unquoted company is an investee with characteristics defined by a point in its life cycle. For example, the company may be contemplating expansion; or its ownermanager may wish to sell part of the business without either losing day-to-day control, or running the risk of that loss of independence which may attend public listing. Although a small firm may acquire investee standing at any stage in its life cycle, in a UK context it has typically been running successfully for some years before it attracts outside equity finance.