ABSTRACT
This chapter examines the roles of management control networks and systems in a domain of business that may be seen as an extreme case of networked organizing—the business of scaling innovative technology start-ups to global business activities through rapidly accelerated innovation processes. It presents core elements of the legal structures of the venture capital (VC) firm and its management control structures and tools. Any economic system that aims at generating growth and prosperity over time must accordingly find effective ways to interact efficient financial re-allocation processes with effective knowledge-driven new business development processes. Research in product innovation in the 1990s identified three main types of information gaps: market uncertainty, technology uncertainty and project scope uncertainty. These three types of risk are core to the innovation process management control systems. VC firms are private equity partnership organizations owned and operated by so-called the general partners (GPs).
