Determinants of dual-class initial public offerings: Evidence of a post-2014 structural shift

Bruno Fiesenig and Louis Schirra

Publications of Darmstadt Technical University, Institute for Business Studies (BWL) from Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute for Business Studies (BWL)

Abstract: This paper investigates the determinants of dual-class share initial public offerings (IPOs) in the United States (U.S.), with a focus on how these drivers have changed over time. By dividing the sample into two periods, before and after 2014, we find a structural shift in the firm characteristics associated with dual-class IPOs. Logistic regression results show that, while many traditional predictors remain stable or insignificant across periods, the technology sector emerges as a key driver in the post-2014 sample, with a strong and statistically significant positive effect on the likelihood of adopting a dual-class structure. This contrasts with the pre-2015 period, in which technology affiliation showed no such influence. Venture capital backing does not appear to play a significant role in either period. Our findings suggest that since 2014, the dual-class IPO landscape has evolved in response to changing market dynamics, particularly reflecting the rise of high-growth technology firms and shifting norms around control and governance at the time of going public. These insights contribute to the ongoing discussion around dual-class structures and their implications for capital market development.

Date: 2025
New Economics Papers: this item is included in nep-inv
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Published in Corporate Ownership and Control 3 (2025) : pp. 62-72

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Persistent link: https://EconPapers.repec.org/RePEc:dar:wpaper:156904

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