Assessing the venture capital legacy : an investigation of post-IPO performance and impact
Loading...
Date
2009
Authors
Journal Title
Journal ISSN
Volume Title
Publisher
Montana State University - Bozeman, College of Letters & Science
Abstract
While extensive literature documents the venture capital impact around the initial public offering, little is known about the enduring effects of venture financing. This paper follows the post-IPO performance of venture-backed U.S. firms in different IPO cohorts from 1970 to 2006, and measures the duration of any venture capital advantages after the IPO. Venture capital strongly correlates with higher R&D and market-to-book ratios ("q"), and venture-backed firms grow faster and perform better particularly in high-tech industries. This apparent advantage for venture-backed firms remains for years following the IPO.