TechCrunch has crunched the data on a study by Yael Hochberg, Alexander Ljungqvist and Yang Lu titled “Whom You Know Matters: Venture Capital Networks and Investment Performance” and have found that better-networked VC firms experience significantly better fund performance.
A venture firm’s network in the study was defined as
being made up of all the other venture firms who co-invested with it in funding rounds. The more co-investors a venture firm has, the better its network. The better its network, the better its overall returns. The correlation between the size of a venture firm’s network and its returns may have something to do with better access to deal flow, talent, advisers, potential customers, and potential exits.
Find out who the Top 100 best networked VC firms are and read the rest of the story here.