This is a cool study from Pepperdine on job growth for private-capital-backed companies vs. those that do not receive funding. Jobs and revenue grow much faster. I believe this is primarily due to a selection bias in the entrepreneur. Like I discussed in my post on Bootstrap or VC? before I started Bazaarvoice, the hat trick for entrepreneurs is to be capital efficient but also not starve their business of growth because they are trying to protect themselves from being diluted as a primary driver versus building their business for the benefit of all. In other words, the type of entrepreneur - and their ambition - makes a huge difference in the ultimate revenue and job growth that their business will experience. VCs obviously look for entrepreneurs that want to hit a home-run and in this way everyone's interests are aligned - as long as the entrepreneur can stomach some dilution for the greater good.

The results were even more dramatic for the 1,854 recipients of venture capital. During the five years after their financing event, these establishments:

1. Generated an increase in revenue that was $24.7 million higher (846 percent more) than non-backed counterparts. This translated into a 36.4 percent compound annual growth rate versus a 6.9 percent rate for non-funded establishments.
2. Created 127 more new jobs (608 percent higher) than non-backed establishments —a 22.4 percent compound annual growth rate versus a 4.5 percent rate for the control group.

Here is the full study.