Arbeitspapier
Moral hazard in VC finance: More expensive than you thought
Venture projects are fraught with exogenous market risk and endogenous agency risk. We apply a real options perspective to analyze the investment decision of the venture capitalist (VC) in this set-up. The solutions presented are conflictive: the VC reduces his exposure to exogenous risk by delaying investments to wait for informational updates (delay option), but he mitigates endogenous risk by advancing investments to discover entrepreneur's effort. So far, papers focus on the optimal timing of investments considering independence of exogenous and endogenous risk. We show that interdependence of exogenous risk and endogenous risk exists. We find that endogenous risk prompts the VC to accelerate the discovery process when exogenous risk is high, and to abandon the delay option when it is most valuable.
- Sprache
-
Englisch
- Erschienen in
-
Series: Hohenheim Discussion Papers in Business, Economics and Social Sciences ; No. 02-2017
- Klassifikation
-
Wirtschaft
Portfolio Choice; Investment Decisions
Asset Pricing; Trading Volume; Bond Interest Rates
Investment Banking; Venture Capital; Brokerage; Ratings and Ratings Agencies
General Equilibrium and Disequilibrium: Financial Markets
- Thema
-
Venture Capital
Real Option
Agency Cost
Moral Hazard
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Tennert, Julius
Lambert, Marie
Burghof, Hans-Peter
- Ereignis
-
Veröffentlichung
- (wer)
-
Universität Hohenheim, Fakultät Wirtschafts- und Sozialwissenschaften
- (wo)
-
Stuttgart
- (wann)
-
2017
- Handle
- URN
-
urn:nbn:de:bsz:100-opus-13315
- Letzte Aktualisierung
-
2025-03-10T11:45:08+0100
Datenpartner
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- Tennert, Julius
- Lambert, Marie
- Burghof, Hans-Peter
- Universität Hohenheim, Fakultät Wirtschafts- und Sozialwissenschaften
Entstanden
- 2017
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