Innovation financing in developing countries

The global competition in products, services, processes and technologies necessitates the existence of a sound infrastructure. The venture capital industry (VCI) is an integral part of this infrastructure and evidence from the 1990s has shown us that the existence of a strong VCI in a country leads to economic power and growth. This paper attempts to find answer to the following question: how can DCs construct an innovation financing system that is relevant to their economic and social context? The discussion in this paper is based on an example of a developing country, Turkey. The paper raises general policy issues that might arise in developing countries, which are in the process of constructing a VCI.