Reassessing the Determinants of Venture Capital Investments in India: An Empirical Analysis Using NCA and fsQCA

We examine the determinants, such as institutional, innovation, economic, stock market, digital, and entrepreneurial environment, that affect venture capital financing (VCF) in India. We adopt an integrated NCA–fsQCA method, as NCA determines the conditions necessary to have VCF and fsQCA reveals the configurations that are sufficient to generate high or low VCF. We identified six and eight combinations that lead to an increase and a decrease in Indian VCF, respectively. This highlights the interdependent and configurational nature of the factors influencing VCF, rather than any single condition being universally necessary and sufficient. Collectively, NCA–fsQCA methods offer a sound insight into the threshold conditions as well as the nonlinear causation that forms venture capital activity in India. The findings have significant implications for stakeholders, allowing them to make informed changes to drivers that will successfully guide VCF in India.