  In this paper we characterize the performance of venture capital-backed firms
based on their ability to attract investment. The aim of the study is to
identify relevant predictors of success built from the network structure of
firms' and investors' relations. Focusing on deal-level data for the health
sector, we first create a bipartite network among firms and investors, and then
apply functional data analysis (FDA) to derive progressively more refined
indicators of success captured by a binary, a scalar and a functional outcome.
More specifically, we use different network centrality measures to capture the
role of early investments for the success of the firm. Our results, which are
robust to different specifications, suggest that success has a strong positive
association with centrality measures of the firm and of its large investors,
and a weaker but still detectable association with centrality measures of small
investors and features describing firms as knowledge bridges. Finally, based on
our analyses, success is not associated with firms' and investors' spreading
power (harmonic centrality), nor with the tightness of investors' community
(clustering coefficient) and spreading ability (VoteRank).
