Control Agreements In Venture Capital Contracts

Document Type : Original Article


Shahid Beheshti University


Venture capital investment is one of the most important and most effective means of financing new businesses. In this type of investment, during the medium-term or long-term relationship with entrepreneurial enterprises while financing and providing management support for these types of businesses, investors terminate this relationship in different ways and exit the entrepreneurial enterprise at the time they find their benefits obtained. They seek to control and influence company decisions in order to maintain the capital and ensure the profit at the time of exit from investment. Given the fact that the amount of venture capital investment is generally less than 50% of the value of the entrepreneurial enterprise, the most important means of achieving this opportunity is to agree on the appointment of the board of directors and the protective provisions contained in the investment contracts, which are discussed in the present paper. It is concluded by providing an explanation of the legal materials governing joint-stock companies that the possibility of applying these agreements, in line with what is globally customary in the venture capital investment industry, is present in Iran as well.


Main Subjects

  1. فهرست منابع

    الف: کتب انگلیسی


    1. Andrew, R. the Entrepreneurial Bible to Venture Capital (Inside Secrets from the Leaders of the Startup Game). US: McGraw-Hill, 2013.
    2. Brian, E. Hill, and Dee Power. Inside Secrets to Venture Capital, US: Wiley, 2001.
    3. Cumming, Douglas, and Sofia A. Johan. Venture capital and private equity contracting an International perspective, 2nd edition. London: Elsevier, 2014.
    4. Durrani, Mansoor, and Grahame Boocock.Venture Capital, Islamic Finance and SMEs (Valuation, Structuring and Monitoring Practices in India). New York: Palgrave Macmillian, 2006.
    5. Fled, Brad, and Jason Mendelson. Venture Deals: Be Smarter than Your Lawyer and Venture Capitalist, US: Wiley, 2011.
    6. Gompers, Paul, and Jash Lerner. The Venture Capital Cycle, US: MIT Press, 1999.
    7. Mahendar, Ramshinghani. The Business of Venture Capital. 2nd Ed. US: Wiley, 2014.
    8. Mccahery, Joseph, and Luc Renneboo. Venture Capital Contracting and the Valuation of High Technology Firms, UK: Oxford University Press, 2003.
    9. Metrick, Andrew, and Ayako Yasuda. Venture Capital and New Innovation off Finance, 2nd Edition, US: Wiley, 2011.
    10. Nour, D. The Entrepreneur’s Guide to Raising Capital. US: Preager Publisher, 2009.
    11. Reid, Gavin, and Julia A. Smith. Risk Appraisal and Venture Capital in High Technology New Ventures, London & New York: Routlrdge (Taylor & Francis Group), 2008.
    12. .
    13. Romans, A. The Entrepreneurial Bible to Venture Capital. Inside Secrets from the Leaders in the Start-up game, US: Mc Graw-Hill Education, 2013.
    14. Schwartz, D. The Future Of Finance: How Private Equity and Venture Capital Will Shape the Global Economy. US: Wiley, 2010.
    15. Wilmerding, A. Termsheet and Valuation, US: Aspator Book, 2003.

    ب: مقالات انگلیسی

    1. Baysinger, Barry, and Robert Hoskisson. “The Composition of Boards of Directors and Strategic Control: Effects on Corporate Strategy,” Academy of Management Review 15, 1990.
    2. Belot, Francois. “Do Target Shareholder Agreements Induce Bidders to pay Higher Premiums,” PHD diss., Université Paris-Dauphine, 2009.
    3. Berglof, E. “a control theory of venture capital finance”, Journal of Law, Economic and Organization 10(2), 1994.
    4. Cendrowski, Harry, and James P. Martin, Louis W. Petro, Adam A. Wadecki,  Private equity History, Governance, and Operations. New Jersey: Wiley, 2008.
    5. Chemla, Gills, and Alexander Ljungvist, Michel Habib. “An Analysis of Shareholder Agreements,” Journal of European Economic Association 5(1), 2007.
    6. Dalton, Dan, and Catherine MDaily, Alan EEllstrand, Jonathan LJohnson. “Meta-analytic Reviews of Board CompositionLeadership Structure, and Financial Performance,” Strategic Management Journal 19, 1998.
    7. Dimov, Dimo, and Dean Shepherd. “Human Capital Theory and Venture Capital Firms: Exploring Home Runs and Strike Outs,” Journal of business Venturing 20(1), 2005.
    8. Gabrielsson, Jonas, and Morten Huse. “Context, Behavior, And Evolution: Challenges in Research on Boards and governance,” International Studies of Management and Organization.34 (3), 2004.
    9. Gordon, S. “Venture Capital Contracting in the Information Age,” Journal of Small & Emerging buiseness2, 1998.
    10. Haugen, Robert, and Lemma Senbet. “The Role of options in the resolution of agency problem,” journal of Finance 36 (3), 1981.
    11. Higashide, Hironori, and Sue Birley. “The Consequences of Conflict Between the Venture Capitalist And The Entrepreneurial Team In The United Kingdom From The Perspective Of The Venture Capitalist,”  Journal of Business Venturing17(1), 2002.
    12. Hodge, O. “Arrangements Which Protect Minority Shareholders against Squeeze- out,” Minnesota Law Review 45, 1961.
    13. Hodge, O. “Giving Shareholders Power to Veto Corporate Decisions: Use of Special Charter and By-laws Provisions,” Law and Contemporary Problems 18, 1953.
    14. Hodge, O.”Control distribution Devices”, university of Illinois law forum1, 1969.
    15. Humphry, H. “A typology of the Theories of the Roles of Governing Boards,” Corporate Governance: An International Review 6(2), 1998.
    16. Kollman, Tobias, and Andreas Kuckertz, Nill Middelberg. “Trust and Controllability in Venture Capital Fundraising,” Journal of business research 67(11), 2014.
    17. Ning Yixi, and Wei Wang, Yu Bo. “The Driving Forces of Venture Capital Investments,” Small Business Economics44(2), 2014.
    18. Roberts, E.  "Initial Capital for the New Technological Enterprise,” IEEE Transaction on Engineering Management.37(2), 1990.
    19. Salhman W. “The Structure and Governance of Venture Capital Organizations,” Journal of Finance Economic 27, 1990.
    20. Sapienza, Harry, and Sophie Manigart, Wim Vermeir. “Venture Capitalist Governance and Value Added In Four Countries,” Journal of Business Venturing 11(6), 1996.
    21. Sensoy, Berk, and Ola Bengtsson. “Investor Abilities and Financial Contracting: Evidence from Venture Capital”, Journal of Finance Intermediation 20, 2011.
    22. Shaker, Zahra, and John Pearce. “Boards of Directors and Corporate Financial Performance,” Journal of Management 15(2), 1989.
    23. Shepherd, Dean, and Andrew Zacharakis. “The Venture Capitalist-Entrepreneur Relationship: Control, Trust and Confidence in Co-operative Behavior,” Journal of Venture Capital an International Journal of Entrepreneurial Finance 3(2), 2001.
    24. Triantis, G. “Financial Contract Design in the World of Venture Capital”, the University of Chicago Law Review68, 2001.
    25. Xueming, Luo, and Rebecca J. Slotegraaf, Pan Xing. “Cross-Functional Coopetition: The Simultaneous Role of Cooperation and Competition within Firms,” Journal of Marketing 70(2), 2006.
    26. Yermack, david, and market hier, “valuation of companies with a small board directors,” journal of finance Economic 40, 1996.


    ج: کتب فارسی


    42. اسکینی، ربیعا، حقوق تجارت (شرکت های تجاری)، ج.2، ویراست.2، تهران: سازمان مطالعه و تدوین کتب علوم انسانی دانشگاهی(سمت)، 1389.

    43. پاسبان، محمد رضا، حقوق شرکت های تجاری، تهران: انتشارات سمت، 1385.

    44. عرفانی، محمود، حقوق تجارت،ج.2، تهران: جهاد دانشگاهی، 1385.

    45. کاویانی، کورش، حقوق شرکت های تجاری، چاپ اول، تهران: میزان، 1386.



    د:مقالات فارسی

    46. جنیدی، لعیا، رحمت دشتی، بررسی نظام حقوقی حاکم بر سهام ممتاز در حقوق ایران و انگلستان، فصلنامه بورس  اوراق بهادار، پاییز 1388، شماره 7.

    47. سلطانی، محمد، نسیم گوهرسود فرد، سرمایه گذاری خطرپذیر و سهام ممتاز، فصلنامه بورس اوراق بهادار، بهار 1396، شماره 37.

    48. سلطانی، محمد، مفهوم و ماهیت حقوقی صندوق‌های سرمایه‌گذاری خطرپذیر، منتشره در کتاب حقوق بازار سرمایه در پرتو حقوق اقتصادی (مجموعه مقالات نخستین همایش ملی حقوق بازار سرمایه)، نشر میزان، 1397


    ه: منابع الکترونیک