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Full-Text Articles in Law

The New Exit In Venture Capital, Darian M. Ibrahim Sep 2019

The New Exit In Venture Capital, Darian M. Ibrahim

Darian M. Ibrahim

No abstract provided.


The (Not So) Puzzling Behavior Of Angel Investors, Darian M. Ibrahim Sep 2019

The (Not So) Puzzling Behavior Of Angel Investors, Darian M. Ibrahim

Darian M. Ibrahim

No abstract provided.


Public Or Private Venture Capital?, Darian M. Ibrahim Sep 2019

Public Or Private Venture Capital?, Darian M. Ibrahim

Darian M. Ibrahim

No abstract provided.


Intrapreneurship, Darian M. Ibrahim Sep 2019

Intrapreneurship, Darian M. Ibrahim

Darian M. Ibrahim

This Article on “intrapreneurship” has several goals. First, it points out that while much of the legal literature on innovation is concerned with startups (entrepreneurship), the innovation that takes place inside our largest corporations (intrapreneurship) is substantial, important, and understudied. Second, the Article observes that while large technology corporations that used to be startups may remain intrapreneurial in culture, intrapreneurship is less common in the aggregate than we might expect. Reasons include organizational bureaucracy, laws favoring entrepreneurship, and what Clayton Christensen (Harvard Business School) calls “the innovator’s dilemma.” The innovator’s dilemma is, put simply, that good management causes ...


Equity Crowdfunding: A Market For Lemons?, Darian M. Ibrahim Sep 2019

Equity Crowdfunding: A Market For Lemons?, Darian M. Ibrahim

Darian M. Ibrahim

No abstract provided.


Crowdfunding Signals, Darian M. Ibrahim Sep 2019

Crowdfunding Signals, Darian M. Ibrahim

Darian M. Ibrahim

Entrepreneurs can now “crowdfund,” or sell securities to unaccredited investors over the Internet, to raise capital. But will these companies be able to attract the follow-on investors (angels and venture capitalists) that are necessary for long-term success? Angels and VCs face extreme levels of information asymmetry when deciding whether to fund a company. Signals can reduce this asymmetry. Early commentary argues a company only crowdfunds as a last resort for fear of sending a negative signal about the company’s quality to follow-on investors. This Article argues the inverse. This Article argues a successful crowdfunding campaign can send a positive ...


Crowdfunding Without The Crowd, Darian M. Ibrahim Sep 2019

Crowdfunding Without The Crowd, Darian M. Ibrahim

Darian M. Ibrahim

The final crowdfunding rules took three years for the Securites and Exchange Commission to pass, but crowdfunding—the offering of securities over the Internet—is now a reality. But now that crowdfunding is legal, will it be successful? Will crowdfunding be a regular means by which new companies raise money, or will it be relegated to a wasteland of the worst startups and foolish investors? This Article argues that crowdfunding has a greater chance of success if regulators abandon the idea that the practice does (and should) employ “crowd-based wisdom.” Instead, I argue that crowdfunding needs intermediation by experts that ...


Crowdfunding Signals, Darian M. Ibrahim Sep 2019

Crowdfunding Signals, Darian M. Ibrahim

Darian M. Ibrahim

No abstract provided.


Debt As Venture Capital, Darian M. Ibrahim Sep 2019

Debt As Venture Capital, Darian M. Ibrahim

Darian M. Ibrahim

Venture debt, or loans to rapid-growth start-ups, is a puzzle. How are start-ups with no track records, positive cash flows, tangible collateral, or personal guarantees from entrepreneurs able to attract billions of dollars in loans each year? And why do start-ups take on debt rather than rely exclusively on equity investments from angel investors and venture capitalists (VCs), as well-known capital structure theories from corporate finance would seem to predict in this context? Using hand-collected interview data and theoretical contributions from finance, economics, and law, this Article solves the puzzle of venture debt by revealing that a start-up’s VC ...


Crowdfunding Without The Crowd, Darian M. Ibrahim Sep 2019

Crowdfunding Without The Crowd, Darian M. Ibrahim

Darian M. Ibrahim

No abstract provided.