Efficient venture capital financing combining debt and equity

I present a model of venture capital contracting in which contracts that involve a mixture of both debt and equity are efficient and dominate pure-equity and pure-debt financing. The optimal contract balances the venture capitalist's incentive to intervene in the project and the entrepreneur's desire for control. Received: 9 September 1997 / Accepted: 3 April 1998     

Human capital and the internationalisation of venture capital firms

We examine the neglected area of internationalisation by VCs. Using a representative sample of 195 VCs, we show that the decision of a European VC firm to invest internationally is driven by its human resources. Having more VC executives in general and more VC executives with previous international experience in specific, results in a higher probability of investing internationally. In contrast, more VC executives with experience in the VC industry or with an engineering background lead to a higher probability of remaining domestic.     

Independent venture capital, corporate venture capital, and the internationalisation intensity of technology-based portfolio firms

Firms that internationalise early in their lives share characteristics with those that receive venture capital. The relationship between receipt of venture capital and the international intensity of 1348 young technology firms is examined, including whether the source of capital, from independent venture capital firms, corporations or private sources, has an impact. The absence of venture capital is shown to be positively associated with increased internationalisation. While previous literature suggests differences in the value added of different sources of venture capital, the results indicate no such differences in their impact on international intensity.     

Market effects of private equity placement: Evidence from Chinese equity and bond markets

Research has provided empirical evidence for the stock market reaction toward private placement; however, similar research has not been conducted in terms of the bond market. Using the event study method, we empirically examine the explanatory power of the signaling, free cash flow, and wealth transfer hypotheses based on the reaction of the stock market, bond market, and firm abnormal returns to the private placement announcement. The results show that the stock market has a negative reaction toward private placement, whereas the bond market has a positive reaction. The results also show that the scale of private placement is correlated with the severity of the market reaction. Abnormal returns indicate no significant change both before and after the private placement, and they are unaffected by the scale of private placement. These results are consistent with the wealth transfer hypothesis; however, the market reaction is not attributable to the signaling hypothesis and the free cash flow hypothesis. Extensive research shows that the abnormal returns of private placement change dramatically in non-state-owned enterprises and firms with low credit rating bonds, whereas the bond maturity has no significant impact on the abnormal returns—the wealth transfer effect of private placement is stronger in non-state-owned enterprises and firms with low credit rating bond.     

IPO performance of portfolio ventures funded by impact investors versus venture capital investors

With the global rise of impact investments to achieve societal goals, an increasing number of new ventures that aim to create societal impact now seek to go public. However, while many conceptual studies suggest that impact investors are less likely to pursue financially oriented exit plans in exchange for generating societal impact, there is little empirical evidence to back up this claim. Using a propensity score matching approach, we draw on data from Crunchbase and empirically compare the initial public offering (IPO) performance of a large sample of 3398 investments by impact investors with 3398 investments by matched venture capital (VC) investors. We find that impact investor investments are less likely to lead to an IPO than VC investments. Besides, our results indicate that syndication by impact investors increases the likelihood of an IPO. This suggests that companies funded by impact investors benefit more from syndication than their VC-funded counterparts. Our findings have practical implications for impact investors, portfolio ventures, and policymakers.     

The impact on the cost of equity capital in the effects of integrated reporting quality

Integrated reporting is a new reporting tool that includes financial and nonfinancial information, which represents a natural evolution of the corporate reporting movement. Although this practice has gained increasing attention in recent years, both from an academic and professional perspective, the quality of the reports still represents a critical aspect due to inadequate investigation. Only a few studies have focused on integrated reporting quality, and contributions on the effects of quality have been even rarer. This study aims to investigate on the impact of integrated reporting quality on the firm's cost of equity capital, owing to the paramount importance of this parameter for firms and investors. Our results highlight that integrated reporting quality has a significantly negative association with the cost of equity capital, suggesting that integrated reporting quality represents an innovative way to reduce the cost of equity. To our knowledge, this is the first study that examines the relationship between integrated reporting quality and a firm's cost of equity.     

风险投资“退出”内涵的系统界定与分析

文章从风险投资微观运作过程入手,对风险投资“退出”内涵进行了系统的界定,详细分析了风险投资“退出”的微观经济功能。文章认为:风险投资“退出”由风险投资项目退出和风险投资基金退出两部分内容构成,是针对风险投资中存在的双重委托———代理关系的最佳制度安排。     

The influence of international human capital on global initiatives and financial performance

The major aim of this study is to investigate the relationships among international human capital (input-based international human capital, transformational, output-based, and competency of top management team), global initiatives (global learning and global marketing) and financial performance. The open systems view is introduced to develop a comprehensive measurement of international human capital, the human capital that enables a firm to compete globally. The structural equation modelling technique is then employed to investigate the proposed relationships. The results support our expectation that international human capital is positively associated with a firm's global initiatives and financial performance. The importance of the role of top management team competency is identified because it is positively associated with the other three international human capital components. It also indirectly fosters a firm's financial performance and global initiatives through its positive association with input-based, transformational, and output-based international human capital.     

Advancement along a career path: the influence of human capital and performance

Following the path metaphor of careers along with signalling and human capital theories, we examine important factors that predict individuals' advancement in a career. With a unique sample of American football players, we tested the influence of individuals' human capital on their performance, value and advancement along a career path. Our findings indicate that individuals' human capital assessed in the first stage of the career path is positively related to individuals' performance in the second stage of the career path and the value placed on individuals in the third stage of the career path. We also found that performance in the second stage mediated the relationship between human capital assessed in the first stage and the value placed on individuals in the third stage of the career path.     

The impact of venture capital financing method on SME performance and internationalization

One of the basic premises of venture capital is leverage, which often means adding money and other resources to speed up growth. As a result, small- to medium-sized venture funded firms are expected to show significant growth at an early stage. Our research examines how equity based-venture funding methods affect SME performance and internationalization. We divide venture capital financing into several categories: incremental financing where firms receive their venture capital funding in portions, lump-sum funding where firms receive their funding in one lump-sum, syndication where two or more external investors participate in a single financing round and non-syndicated financing where one investor participates in a single financing round. The results show that type of equity-based venture capital financing affect performance and internationalization. Annual sales growth rate and annual turnover are used as proxies for performance. Export ratio is used as a proxy for internationalization. Staged financing and financing through a syndicate has a positive effect on performance and internationalization when used separately. We observe a negative effect when syndication and staged financing are used in combination.     

The emergence of human capital: Roles of social capital and coordination that drive unit performance

Empirical work on human capital has tended to focus on the direct effects of human capital on performance, whereas little attention has been paid to behaviours through which human capital influences performance. This study uses the “human capital emergence” model to examine relationships among human capital, social capital, coordination, and performance over a 2‐year period of time. Findings indicate that human capital, social capital, and coordination each influence performance. Human capital and social capital also positively predict coordination. Lastly, coordination mediates the relationships between human capital and performance and social capital and performance.     

Institutional changes of Specified Purpose Acquisition Companies (SPACs)

This study documents the changes in the corporate design of modern Specified Purpose Acquisition Companies (SPACs) for the years 2003–2012. Do institutional characteristics of SPACs determine the success of their merger outcomes? The paper finds that SPACs significantly redesigned their structure in the period under observation. In addition, the probability of a merger for SPACs increases if they are able to announce the deal soon after the Initial Public Offering (IPO), if the deal focuses on China and when their IPO is underwritten by Early Bird Capital.     

The role of technology-based services in establishing brand equity within the private hospitals sector in Kuwait

This study aims to explore the role of technology-based services in establishing brand equity within the private hospitals sector in Kuwait. A survey is designed based on dimensions that include ease of use, e-responsiveness, e-scape, security, and customization. E-responsiveness and security had strong and direct influence on brand equity; whereas, ease of use, e-escape, and customization had no significant positive impact on the brand equity. The proposed model of relationship between e-service quality and brand equity has the potential to help hospital managers to establish their brand equity through managing the level of their online services.     

人力资本的再认识与国有企业激励机制创新

经过20多年的改革,在国有企业组织功能和治理制度安排已经发生重大变迁的情况下,由于对人力资本的产权特征认识不足或缺少配套的保护措施,激励制度安排却没能真正实现从政治激励到经济激励转换,这种制度安排的缺位或不配套,使改革进程中"59岁现象"和"冯根生难题"难以避免,国有企业低效率和缺乏竞争力的问题没有得到根本解决.推进国有企业的改革与发展,必须高度重视人力资本的私人产权特征,并给予合理定价,加快制度安排由政治激励转为经济激励的进程.     

n-人博弈中的策略选择及股权比例与实际势力不对称问题分析

股东控制公司的一条重要途径是通过持有公司股份。然而在对公司控制中,股东真正追求的应该是控制能力而不纯粹是股份比例的大小。这种能力在文章中称之为势力。股份大小与势力成正比,但不是一个简单的函数关系。从投票角度来说,一个大股东有时完全处于被动地位,而小股东却能获得与份额不相称的势力,这完全取决于股权结构状况。文章从一个简单的案例入手,分析了处于不同结构与情境下股权结构与势力结构的变化。从中可以看出,结构问题往往还预示着参与人各方之间的冲突可能性。     

我国私营企业劳资关系初探

目前我国私营企业工会职能弱化,集体谈判和集体合同制度没有得到普及,劳资冲突日益严重的现状所造成的负面影响已引起了各方面的关注。文章认为应从组建工会、强化工会职能、健全劳资关系立法、推行集体谈判和集体合同制度、运用现代激励理论建立员工激励机制等方面入手构建健康稳定和谐的劳资关系。     

The role of the board and the audit committee in corporate risk management

This paper examines the impact of corporate governance on corporate risk-management activities in S&P 500 firms over the period 2004–2010 by measuring the characteristics of the board directors and audit committee. Our results show that the board of directors, especially the audit committee, plays an important role in the firm’s hedging decisions, including whether to hedge and to what extent. Such evidence is even stronger in high-leveraged firms with large risk-shifting incentives. These results are robust to the consideration of endogenous concerns, a board corporate governance index, and industrial effects. Our study contributes to the literature by showing the influential role of the audit committee on corporate risk management.     

The effect of mergers and acquisitions on environmental,social and governance performance and market value: Evidence from EU acquirers

This study explores the effect of environmental, social, and governance (ESG) performance on market value and performance in the context of mergers and acquisitions. We examine whether acquisition of targets with better ESG performance can help acquirers to increase their own ESG performance and whether the market values the increased ESG performance positively. Moreover, we explore whether the acquisition of targets with better ESG performance affects the market value of acquirers. For this study, we utilize a sample of 100 European mergers and acquisitions between 2003 and 2017, for which matching data on the ESG performance of both the target and acquiring firms are available. Our results show that the postmerger ESG performance of the acquirer increases following the acquisition of a target that has higher ESG performance than that of the acquirer in the premerger stage, whereas the postmerger market value of the acquirer increases following an increase in the acquirer's postmerger ESG performance in relation to its premerger ESG performance. Finally, we provide partial evidence of a positive relationship between the postmerger market value of the acquirer and the acquisition of a target with higher ESG performance than itself in the premerger stage.     

Antecedents and consequences of social capital on buyer performance improvement

The ability to leverage social capital within strategic buyer–supplier relationships is increasingly cited as a key driver of value creation. Despite the importance of strategic partnerships, the process by which social capital accumulates within buyer–supplier relationships and contributes to buyer performance improvements is not well understood. Drawing on social capital theory, we develop a model linking positive relational capital, and its antecedents, supplier integration and supplier closeness, to buyer performance improvements. Further, we hypothesize that structural capital, as reflected in managerial communication and technical exchanges, is also positively related to buyer performance improvements. Using data provided by 111 procurement executives from the United Kingdom, we find support for our hypotheses. The study extends the supply chain management and social capital literature and suggests important implications for both research and practice.