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Author: Natdanai Aleenajitpong
Publisher:
ISBN:
Category :
Languages : en
Pages : 3
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Book Description
Venture capital firms (VC) have encountered with uncertainty and risk of asymmetric information due to an investment in early-to-growth stage and technology-based start-ups. Venture capital syndication network helps reduce a broad gap of information asymmetry and agency problem in a venture capital investment. Although agency and asymmetric information theory help motivate the formation of networks in emerging venture capital markets, Institutional theory is more suitable in explaining this situation, as the practice of venture capital appears to be influenced from institutional changes. As network connections are found to be the success factor for venture capitalists under a lack of fully developed institutional environment in emerging market. Venture capital industry in Southeast Asia is nascent yet in demanding and fast growing. Southeast Asia (SEA) is one of the most significant and dynamic propellers of the world economy. To clarify the role of networks and institutions on VC-backed firms in SEA VC market, we then investigate the relationship between networks and institutions and their impact on portfolio company's performance. Our study will initiate an empirical evidence by quantifying VC networks and institutions among SEA countries and implementing time-series panel regressions through the performance of VC-backed companies.
Author: Natdanai Aleenajitpong
Publisher:
ISBN:
Category :
Languages : en
Pages : 3
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Book Description
Venture capital firms (VC) have encountered with uncertainty and risk of asymmetric information due to an investment in early-to-growth stage and technology-based start-ups. Venture capital syndication network helps reduce a broad gap of information asymmetry and agency problem in a venture capital investment. Although agency and asymmetric information theory help motivate the formation of networks in emerging venture capital markets, Institutional theory is more suitable in explaining this situation, as the practice of venture capital appears to be influenced from institutional changes. As network connections are found to be the success factor for venture capitalists under a lack of fully developed institutional environment in emerging market. Venture capital industry in Southeast Asia is nascent yet in demanding and fast growing. Southeast Asia (SEA) is one of the most significant and dynamic propellers of the world economy. To clarify the role of networks and institutions on VC-backed firms in SEA VC market, we then investigate the relationship between networks and institutions and their impact on portfolio company's performance. Our study will initiate an empirical evidence by quantifying VC networks and institutions among SEA countries and implementing time-series panel regressions through the performance of VC-backed companies.
Author: Yael V. Hochberg
Publisher:
ISBN:
Category :
Languages : en
Pages : 55
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Book Description
Many financial markets are characterized by strong relationships and networks, rather than arm s-length, spot-market transactions. We examine the performance consequences of this organizational choice in the context of relationships established when VCs syndicate portfolio company investments, using a comprehensive sample of U.S. based VCs over the period 1980 to 2003. VC funds whose parent firms enjoy more influential network positions have significantly better performance, as measured by the proportion of portfolio company investments that are successfully exited through an initial public offering or a sale to another company. Similarly, the portfolio companies of better networked VC firms are significantly more likely to survive to subsequent rounds of financing and to eventual exit. The magnitude of these effects is economically large, and is robust to a wide range of specifications. Our models suggest that the benefits of being associated with a well-connected VC are more pronounced in later funding rounds. Once we control for network effects in our models of fund and portfolio company performance, the importance of how much investment experience a VC has is reduced, and in some specifications, eliminated.
Author: William Scheela
Publisher: Business Expert Press
ISBN: 1606497774
Category : Business & Economics
Languages : en
Pages : 102
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Book Description
This book is one of the first to analyze the development of private equity, to include venture capital and business angel investing in emerging Southeast Asian economies of Thailand, Philippines, Vietnam, Indonesia, and China. The author analyzes the investment strategies of both types of private equity investors who face significant challenges when investing in emerging economies lacking the legal and financial institutions needed to support effective private equity investing. With the author’s detailed field research in Southeast Asia, as well as recent private equity research in China, you’ll learn about investment strategies (whether you’re a venture capitalist or business angel) in emerging markets. This investment strategy is based on significant networking that is used to build social capital, in-depth due diligence, and hands-on post-investment monitoring.
Author: Cristiano Bellavitis
Publisher:
ISBN:
Category :
Languages : en
Pages : 46
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Book Description
This study examines the influence of intra- and extra-industry networks on firm performance by using data on 1264 UK venture capital (VC) backed start-up companies. The ventures' network was operationalized by connecting together the various portfolio companies sharing the same investor. Regression results show that the venture's network has a strong impact on firm's success. Yet, whereas extra-industry ties are directly and positively linked to the likelihood of the venture to reach a successful exit, intra-industry ties exert a negative impact on companies' performances. However, interaction effects show that once a firm establishes a sufficient number of extra-industry ties, it is able to profit from the network in its industry of operation. Overall, these findings show that an optimal balance of ties is achieved through a diverse set of connections incorporating both intra- and extra-industry ties.
Author: Monika Köppl-Turyna
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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Book Description
In this paper we analyze how different types of venture capital investments - private, public and indirect public - affect performance of portfolio companies. We use data on more than 20,000 VC deals in Europe between 2000 and 2018 and we hand collected a unique dataset on the institutional setting (public/indirect/private) of almost 5000 investors. We find that public VC investors perform consistently worse than purely private ones, while indirect public investments (such as the "Juncker Plan" or InvestEU investments) perform consistently better. We link these findings to the fact that public funds do not enter the best performing cliques of investments. On the other hand, indirect funds invest in the VC funds with the best network characteristics, which raises a question of whether indirect VC investments are associated with a high level of windfall gain, and not necessarily improve the value added by the VC funds. We confirm the main conclusions using instrumental variables' specifications.
Author: Phillip Ryan
Publisher: The Rosen Publishing Group, Inc
ISBN: 1448867959
Category : Juvenile Nonfiction
Languages : en
Pages : 82
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Book Description
Explanations to the inner workings of one of the least understood, but arguably most important, areas of business finance is offered to readers in this engaging volume: venture capital. Venture capitalists provide necessary investment to seed (or startup) companies, but the startup is only the beginning, there is much more to be explored. These savvy investors help guide young entrepreneurs, who likely have little experience, to turn their businesses into the Googles, Facebooks, and Groupons of the world. This book explains the often-complex methods venture capitalists use to value companies and to get the most return on their investments, or ROI. This book is a must-have for any reader interested in the business world.
Author: Natdanai Aleenajitpong
Publisher:
ISBN:
Category :
Languages : en
Pages : 7
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Book Description
Venture capital firms (VC ...
Author: Alexander Ljungqvist
Publisher:
ISBN:
Category :
Languages : en
Pages : 56
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Book Description
Many financial markets are characterized by strong relationships and networks, rather than arm's-length, spot-market transactions. We examine the performance consequences of this organizational choice in the context of relationships established when VCs syndicate portfolio company investments. VC firms that enjoy more influential network positions have significantly better fund performance, as measured by the proportion of investments that are successfully exited through an IPO or sale to another company. Similarly, the portfolio companies of better-networked VC firms are significantly more likely to survive to subsequent financing and to eventual exit. Finally, we provide initial evidence on the evolution of VC networks.
Author: Sophie Manigart
Publisher:
ISBN: 9781601986504
Category : Business & Economics
Languages : en
Pages : 209
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Book Description
In Venture Capital Investors and Portfolio Firms venture capital firms are considered as investors in young growth-oriented companies. The authors focus on the later phases of the venture capital (VC) investment process. They therefore emphasize monitoring, value adding, and exiting activities. They also include a review of the literature on the outcome of venture capital investment activities. Research findings are drawn principally from refereed journal papers in entrepreneurship, finance, and management. The monograph is divided into six principal areas: 1.What venture capital firms do. 2.The impact of VCs on portfolio firms and other stakeholders. 3.The role of syndication. 4.The nature and timing of exit from VC investments. 5.The role of VCs in portfolio companies that undergo an initial public offering (IPO). 6.The returns from investing in VC. Venture Capital Investors and Portfolio Firms concludes with a detailed agenda for further research. To aid the reader who wishes to pursue particular papers in more detail, the authors provide a summary of the main papers in this literature in a set of tables where they identify the authors, publication date, the journal, the main research question, the theoretical perspective, data, and the principal findings.
Author: Cristiano Bellavitis
Publisher:
ISBN: 9781631579844
Category : Business & Economics
Languages : en
Pages : 0
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Book Description
In the venture capital (VC) industry, firms often co-invest with other peers in syndicated deals. The process of syndication is a form of investment alliance that generates networks of VC firms and start-up companies. Despite the prominent role played by syndicates, extant entrepreneurship literature found contradicting evidence on the relationship between the practice of syndication and the performance of both the start-up and the investors. In fact, our understanding of the circumstances under which syndicates have the potential to boost performance, rather than hamper them, is still limited. Previous literature suggested that syndicates improve the access to resources for both the entrepreneurs and the VC partners. However, syndicates, as opposed to solo investments, carry agency costs such as free riding and conflicts of interests among co-investors. I investigate the role of syndicates on performance building upon network and alliance literature. Recent studies show that syndicates, networks, and alliances have the potential to be both an asset and a liability for the focal actor. This applies to the amount of connections that a firm has, the structure of its network, or the composition of the alliance. I apply a contingency perspective to investigate the boundary conditions under which syndication exerts a positive rather than a negative effect on performance. I test theoretical claims at three levels of analysis: at the start-up level, at the VC investors' level, and the syndicate level.
