Heuristics of capital: a historical sociology of US venture capitalism, 1946-1968

Zhikharevich, Dmitrii M. (2019) Heuristics of capital: a historical sociology of US venture capitalism, 1946-1968. PhD thesis, London School of Economics and Political Science.

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Abstract

This thesis examines the emergence and early history of venture capitalism in the US as a project of capitalization. As theorized in recent literatures on valuation studies and the “new” history of capitalism, capitalization is a collective activity, simultaneously cognitive and socio-technical, of “turning things into assets.” As such, it requires the capitalizing subject to “think as an investor.” The history of capitalism can be reconstructed as a history of successive “regimes of investment,” differing in terms of which assets get capitalized and under what terms. Before stabilizing as a “regime,” however, capitalization begins as a project that is logically and historically anterior to the institutions and technologies that will later hold it together. Rather, projects of capitalization emerge as ways of imagining certain objects as investments, or capital assets. In the early history of venture capital in the US, this imagination was targeted at young, small, technology-based firms. Prospective investors — who eventually became early venture capitalists — deployed a set of informal heuristics adopting some of the categories from the classifications used by the applied financial and managerial disciplines. This thesis follows the sequence of episodes through which these heuristics increasingly became centered on “people,” eventually helping create a novel action under a description and, to put it in Ian Hacking’s terms, a corresponding human kind — technical entrepreneurs. Accordingly, the analytical approach is nominalist: no claim is made as to whether the heuristics deployed by the actors featuring on the pages to follow could serve as a substitute for probabilistic calculation or any other formal calculative device. Yet however “effective” these heuristics might have been, they did have certain dynamic effects, applying and creating new classifications of investment opportunities, companies, and, eventually, people. As a result, in the early 1970s, venture capitalists defined themselves as being engaged in the “people business.” Rather than effectively “turning engineers into entrepreneurs” through coercive or performative effects, they created the category of “technical entrepreneurs” as a human kind, that is, as an open possibility for being a certain kind of person, without necessarily becoming one.

Item Type:	Thesis (PhD)
Additional Information:	© 2019 Dmitrii M. Zhikharevich
Library of Congress subject classification:	H Social Sciences > HF Commerce > HF5601 Accounting H Social Sciences > HG Finance H Social Sciences > HM Sociology
Sets:	Departments > Accounting
Supervisor:	Miller, Peter and Giraudeau, Martin
URI:	http://etheses.lse.ac.uk/id/eprint/4275

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