This study explores whether a new venture invested by a venture capital (VC) firm which is a new entrant to the new venture's industry will achieve a better or worse growth performance. Using the data of 18910 investment deals in China from 2010 to 2018, we find that the industry dissimilarity between a new venture in which a VC firm will invest and the VC firm's portfolio can help the new venture achieve a better growth performance. Such a positive effect would be stronger when the VC firm has more successful experience, when the financing stage of the deal is later, or when the investment environment of the industry is hotter.
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