Choosing Between Promising and Crowded Industries: How Does the Venture Capital Industry Fare in Each?

Amir Shachmurove () and Yochanan Shachmurove ()
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Amir Shachmurove: Department of Economics, University of Pennsylvania

PIER Working Paper Archive from Penn Institute for Economic Research, Department of Economics, University of Pennsylvania

Abstract: Incredible profits from Initial Public Offerings have been highly emphasized. This paper refutes these profits as being standard and supports the market’s return to normalcy by stratifying annual and cumulative returns for different industries: Biotechnology; Communications; Computer Related companies; Medical, Health and Life Science industries; Non-High-Technology companies; and Semiconductor and Other Electronics Industries. This paper tests whether an entrepreneur has greater potential for success in continually promising fields or whether one should slug it out in a risky but potentially very rewarding industry. A comparison of success is made between already competitive businesses and those, which are young and growing.

Keywords: Initial public offering; venture capital; annualized and cumulative rates of return; Information Technology; Medical; Health and Life Science; Non-High Technology; Biotechnology; Communications; Computer Industry; Semiconductor and Other Electronics Industries (search for similar items in EconPapers)
JEL-codes: C12 D81 D92 E22 G12 G24 G3 M13 M21 O16 O3 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ent and nep-fin
Date: 2004-12-17
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