Venturebacked IPOs: Investment Duration and Lockup by Venture Capitalists
Journal
Finance Letters
Type
journal article
Date Issued
2003
Author(s)
Abstract
We analyze the venture capitalist's decision on the timing of the IPO, the offer price and the fraction of shares he sells in the course of the IPO. Under certain assumptions about the parameters and the structure of the model, we obtain a single equilibrium in which high-quality firms separate from low-quality firms. The latter are liquidated after the first period, while the former go public either after having been financed by the venture capitalist for two periods or after one financing period using a lock-up.
Language
English
HSG Classification
contribution to scientific community
HSG Profile Area
SOF - System-wide Risk in the Financial System
Refereed
Yes
Volume
1(2)
Start page
61
End page
65
Pages
4
Subject(s)
Division(s)
Eprints ID
259439