Offshore democracy: launch and landfall of a socio-technical experiment

Germany's bank-based financial system has been generally perceived as good at providing long-term debt finance to traditional industry but poor at supplying equity capital to high-tech start-ups. In 1997 a special segment of the Frankfurt stock exchange, the Neuer Markt , was founded to improve the supply of high-risk equity capital in Germany. The subsequent listing of over 300 companies on the Neuer Markt , many of them in technology-intensive sectors, has led to speculation that Germany is rapidly closing the gap with the US, the world leader in high technology. Contrary to this view, this article suggests that these companies have more in common with traditional German small and medium-sized companies (SMEs) than with the Silicon Valley model of governance and innovation.