New insights into venture capitalists' activity: IPO and time-to-exit forecast as antecedents of their post-investment involvement

Violetta Gerasymenko and Jonathan D. Arthurs

Journal of Business Venturing, 2014, vol. 29, issue 3, 405-420

Abstract: We examine how VCFs' forecast of an IPO exit affects their breadth of advising and the likelihood of founder–CEO replacement shortly after they invest in a new venture. Moreover, we examine how the expected time-to-exit moderates these relationships. Our findings show that the likelihood of founder–CEO replacement upon receiving venture capital funding is significantly greater if a VCF perceives this company as a potential IPO as opposed to a trade sale, and this likelihood increases if the forecasted time-to-exit is short. We also illustrate how the breadth of advice varies as a function of the forecasted IPO and time-to-exit.

Keywords: Venture capital; IPO exit; Forecast; Attention; Post-investment involvement (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0883902613000566
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jbvent:v:29:y:2014:i:3:p:405-420

DOI: 10.1016/j.jbusvent.2013.06.003

Access Statistics for this article

Journal of Business Venturing is currently edited by S. Venkataraman

More articles in Journal of Business Venturing from Elsevier
Bibliographic data for series maintained by Catherine Liu ().