Arbeitspapier

Are IPOs of different VCs different?

This paper aims to analyze the impact of different types of venture capitalists on the performance of their portfolio firms around and after the IPO. We thereby investigate the hypothesis that different governance structures, objectives and track record of different types of VCs have a significant impact on their respective IPOs. We explore this hypothesis by using a data set embracing all IPOs which occurred on Germany's Neuer Markt. Our main finding is that significant differences among the different VCs exist. Firms backed by independent VCs perform significantly better two years after the IPO compared to all other IPOs and their share prices fluctuate less than those of their counterparts in this period of time. Obviously, independent VCs, which concentrated mainly on growth stocks (low bookto- market ratio) and large firms (high market value), were able to add value by leading to less post-IPO idiosyncratic risk and more return (after controlling for all other effects). On the contrary, firms backed by public VCs (being small and having a high book-to-market ratio) showed relative underperformance.

Language
Englisch

Bibliographic citation
Series: CFS Working Paper ; No. 2004/02

Classification
Wirtschaft
General Financial Markets: General (includes Measurement and Data)
Information and Market Efficiency; Event Studies; Insider Trading
Investment Banking; Venture Capital; Brokerage; Ratings and Ratings Agencies
Subject
Venture Capital
Initial Public Offerings
Long-Run Performance
Underpricing
Wertpapieremission
Risikokapital
Corporate Governance
Börsenkurs
Unternehmensentwicklung
Schätzung
Deutschland

Event
Geistige Schöpfung
(who)
Tykvová, Tereza
Walz, Uwe
Event
Veröffentlichung
(who)
Goethe University Frankfurt, Center for Financial Studies (CFS)
(where)
Frankfurt a. M.
(when)
2004

Handle
URN
urn:nbn:de:hebis:30-10549
Last update
10.03.2025, 11:42 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Tykvová, Tereza
  • Walz, Uwe
  • Goethe University Frankfurt, Center for Financial Studies (CFS)

Time of origin

  • 2004

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