Venture capital decision-making in green investments

The overarching purpose of this thesis is to provide a comprehensive understanding of venture capital decision-making in the context of green startups. To address this purpose, the present work examines three issues regarding: 1) the propensity of heterogenous VC types (Independent, Corporate, and Governmental) towards green startups, 2) the influence of environmental policy on the decision-making of Independent and Corporate VCs, and 3) the role of similarity-heuristics, with a specific focus on value similarity on Independent VCs’ decisions to invest in green startups. These three issues have been investigated in two research articles that provide a basis for this doctoral thesis. This thesis is organized into five chapters. Chapter 1 introduces green startups and green VC investments, outlining the thesis structure, objectives, and methods. Chapter 2 reviews key definitions and prior literature, identifies three research gaps, and presents the theoretical perspectives used. Chapter 3 analyzes how IVC, CVC, and GVC make investment decisions in green startups and examines how environmental policies incentivize or constrain independent and corporate VCs. Chapter 4 explores heuristics in green investing, focusing on founder–VC similarity (especially value similarity) in IVC decisions. Chapter 5 summarizes findings, highlights theoretical contributions, discusses implications for founders, policymakers, and investors, and concludes with limitations and future research directions.