Value Adding in Venture Capital: A Practice-theory Perspective

  • Norah Alshaikhmubarak

Student thesis: Doctoral ThesisPhD


The value-adding role of venture capitalists (VCs) in their involvement with their portfolio companies (PCs) has remained a “black box”, removed from its social, cultural and institutional context. It is posited that, if VCs operating in different contexts engage in different value-adding activities, such activities need to be studied in context. In this thesis, I do precisely this by adopting a practice-theory perspective informed by Schatzki’s ‘site ontology’. Taking this perspective enables me to articulate the social premises of value, represent VCs’ post-investment involvement as a set of value-adding practices, and explore their constitutive elements and continuous enactment.

Thus, the thesis presents a conceptual and empirical investigation to advance an understanding of what constitutes value and what VCs do to add this value to their PCs. This thesis establishes this by investigating: (1) the social site, (2) the practices that constitute the site and how they fit together, (3) practices associated with VC value adding, and (4) variations in investment practices across organizations in which they operate. To facilitate this investigation, two case studies, based on qualitative data, were chosen. For the first case study, data was collected from a VCF in Dubai over five weeks, and includes that gained from observations, interviews, and an extensive archive. For the second case study, data was collected from two VCFs in Jordan over a week and is based primarily on interviews and a one-day observation in each firm.

Schatzki’s site ontology framework was drawn on to identify VCs’ value-adding practices as organized by understandings, rules, and teleoaffective structure. The findings show value adding to be a profoundly socially-embedded process connected to (or forming a net with) various people (e.g. VCs, investors, advisors), other practices (e.g. fundraising, deal originating, and pre-investment), and other entities or organizations. This demonstrates that, in these case studies at least, VCs’ value adding is not an isolated activity but one entwined with relational practices and is aligned with the preferences of different stakeholders. Nevertheless, I show that while the nature and content of practice vary across contexts, they share a common structure in terms of resting on specific understanding, rules, and teleoaffective structures.

This thesis contributes to a broader understanding of venture capital (VC) by opening the “black box” of VCs’ value-adding practices by investigating everyday VC value-adding activities in the wider social context. Also, it takes a distinct view, through a practice-based lens, to understand the situated nature of VC practices. I believe that this paper is among the first to introduce practice theory to the VC context. The thesis outlines theoretical contributions, implications for practice, and avenues for future exploration.
Date of Award24 Mar 2021
Original languageEnglish
Awarding Institution
  • University of Bath
SponsorsRoyal Embassy of Saudi Arabia
SupervisorDimo Dimov (Supervisor) & Antonio Costa (Supervisor)


  • Venture Capital
  • Value adding
  • Practice theory

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