A new study by EPFL’s Gaétan de Rassenfosse, forthcoming in Small Business Economics, shows that venture competitions can improve startup outcomes — but not always for the reasons entrepreneurs expect.Venture competitions have become a familiar feature of startup ecosystems. For early-stage firms, they promise funding, visibility, mentoring and validation. Yet it has remained unclear what exactly makes them valuable: the money they provide, or the signal that a credible jury considers a startup promising?The new study, co-authored with Matthias van den Heuvel, addresses this question by exploiting the structure of Venture Kick, Switzerland’s leading venture competition. The competition unfolds in three stages. Winning the first stage brings visibility and a relatively small cash award, making it useful for measuring the value of certification. Winning the final stage comes with a much larger prize, allowing the authors to study the effect of cash. The researchers also use detailed grades assigned by judges to account for differences in startup quality.The results show that winning the first stage increases the average probability of survival two years after the competition by 22 percentage points. It also raises the probability of securing external financing by 14 percentage points.But the benefits are far from uniform. For science-based startups, the certification effect is particularly strong. Winning the first stage raises their two-year survival rate by 41 percentage points, and the effect remains visible six years after the competition. For ICT startups, by contrast, the same certification does not appear to improve later outcomes.Using detailed data on nearly 1,000 startups that took part in Switzerland’s Venture Kick competition, the study finds that expert endorsement can have a lasting effect on survival and fundraising, while cash prizes mainly buy time for low-cost digital ventures.A new study by EPFL’s Gaétan de Rassenfosse, forthcoming in Small Business Economics, shows that venture competitions can improve startup outcomes — but not always for the reasons entrepreneurs expect. Using detailed data on nearly 1,000 startups that took part in Switzerland’s Venture Kick competition, the study finds that expert endorsement can have a lasting effect on survival and fundraising, while cash prizes mainly buy time for low-cost digital ventures.The authors interpret this difference as a matter of signal quality. In science-based fields, expert judges may be better able to assess a venture's underlying quality. Their endorsement therefore provides useful information to both entrepreneurs and investors. In ICT, where early-stage quality may be harder to assess, the same signal appears less informative.Cash prizes work differently. Winning the final stage, with its $100,000 award, has no significant average effect on future survival or fundraising. It does, however, improve the short-term survival of ICT startups by 23 percentage points in the first two to three years after the competition — consistent with the idea that cash extends the runway of ventures with relatively low running costs. For capital-intensive science-based startups, the amount is too small to materially change their trajectory.“Startup competitions are often presented as sources of funding, but our results suggest that their strongest contribution may be informational,” says de Rassenfosse. “A credible jury can help entrepreneurs and investors learn which ventures deserve more attention. Cash can buy time, but it does not necessarily change a startup’s underlying prospects.”The findings have direct implications for the design of entrepreneurship support programs. Rather than focusing only on the size of awards, organizers should invest in the credibility, expertise and sectoral fit of their evaluation panels. For entrepreneurs, the lesson is similarly practical: choose competitions not only for the money on offer, but also for the quality of the signal they send to investors and partners.