Investor-patent networks as mutualistic networks

TL;DR

This paper analyzes venture capital investment networks as mutualistic systems, revealing their structural properties and implications for the robustness of technological innovation during crises.

Contribution

It introduces a bipartite patent-investor network model showing mutualistic topological features in venture capital investments.

Findings

The network is topologically mutualistic with links between generalist investors and general-purpose technologies.

High nestedness and low modularity contribute to robustness against crises.

The network exhibits high connectance typical of mutualistic systems.

Abstract

Venture capital investments in startups have come to represent an important driver of technological innovation, in parallel to corporate- and government-directed efforts. Part of the future of artificial intelligence, medicine and quantum computing now depends upon a large number of venture investment decisions whose robustness against increasingly frequent crises has therefore become crucial. To shed light on this issue, and by combining large-scale financial, startup and patent datasets, we analyze the interactions between venture capitalists and technologies as an explicit bipartite patent-investor network. Our results reveal that this network is topologically mutualistic because of the prevalence of links between generalist investors, whose portfolios are technologically diversified, and general-purpose technologies, characterized by a broad spectrum of use. As a consequence, the robustness of venture-funded technological innovation against different types of crises is affected by the high nestedness and low modularity, with high connectance, associated with mutualistic networks.