Brander, James AAmit, RaphaelAntweiler, Werner2023-05-222023-05-222002-01-012018-07-09https://repository.upenn.edu/handle/20.500.14332/40456Syndication arises when venture capitalists jointly invest in projects. We model and test two possible reasons for syndication: project selection, as an additional venture capitalist provides an informative second opinion; and complementary management skills of additional venture capitalists. The central question is whether venture capitalists are engaged primarily in selection or in managerial value added. These alternatives imply contrasting predictions about comparative returns to syndicated and standalone investments. Our empirical analysis, using Canadian data, finds that syndicated investments have higher returns, favoring the value‐added interpretation. We also discuss risk sharing and project scale as possible reasons for syndication.This is the peer reviewed version of the following article: [Brander, J.A., Amit, R., & Antweiler, W. Venture-Capital Syndication: Improved Venture Selection vs. The Value-Added Hypothesis. Journal of Economics & Management Strategy 11, no. 3: pp. 423-452], which has been published in final form at http://dx.doi.org/10.1111/j.1430-9134.2002.00423.x. This article may be used for non-commercial purposes in accordance with Wiley Terms and Conditions for Use of Self-Archived Versions.venture capitalsyndicationentrepreneurshipBusiness Administration, Management, and OperationsBusiness and Corporate CommunicationsCorporate FinanceFinance and Financial ManagementManagement Information SystemsManagement Sciences and Quantitative MethodsOrganizational Behavior and TheoryPortfolio and Security AnalysisStrategic Management PolicyReport