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Full-Text Articles in Business
Assessing The Value Of Ventures: Crowd Investors Vs. Sophisticated Investors, Marco Bade
Assessing The Value Of Ventures: Crowd Investors Vs. Sophisticated Investors, Marco Bade
The Journal of Entrepreneurial Finance
Recent regulatory approaches in crowdfunding democratize capital markets. Adverse wealth effects may arise because of information asymmetry. Firoozi et al. (2017) argue that crowdfunding has wealth-reducing effects on crowd investors because they systematically assign less value to good ventures, and more to bad ventures. This paper aims to take a more differentiated perspective by incorporating two dimensions of uncertainty determining ventures’ value. It further takes into account that different investor types learn different information. This yields new findings concerning the assessment of venture value by crowd investors and sophisticated investors. Crowd investors’ may be able to better assess venture value, …
Do Private Firms Benefit From Trading In The Private Securities Market?, Robert Loveland, Eric Fricke, Sinan Goktan
Do Private Firms Benefit From Trading In The Private Securities Market?, Robert Loveland, Eric Fricke, Sinan Goktan
The Journal of Entrepreneurial Finance
The trading of private securities has recently gained greater visibility and importance with the advent of organized, private security exchanges. This paper uses data on IPO firms that list on the SharesPost private securities exchange platform to examine the potential benefits of a listing. Specifically, we test whether a listing reduces IPO underpricing or enables liquidity provision to firm employees. Controlling for endogeneity, we find no evidence that a pre-IPO listing on SharesPost lessens IPO underpricing. However, we also find that SharesPost-listed companies are able to pay their employees less in cash and more in stock and stock options than …
News Management Around Equity Private Placements, Hsiao-Chen Liang, Woan-Yuh Jang
News Management Around Equity Private Placements, Hsiao-Chen Liang, Woan-Yuh Jang
The Journal of Entrepreneurial Finance
Private placement is the sale of securities to a limited number of qualified institutions or high-wealth investors. Although private placement is favorable for firms raising capital, it is relatively easy for managers to exploit it to benefit specific investors. Using a sample of Taiwanese private placements covering 2006 to 2010, we use both quantitative and qualitative variables to examine the determinants of the valence and tenor of media coverage around private placement announcements and study whether managers strategically perform news management. The results show that issuers will engage in news management around private placement announcements to facilitate the issue process. …