Commercialization Strategy and IPO Underpricing

Serena Morricone, Federico Munari, Raffaele Oriani and Gaétan de Rassenfosse

Research Policy, 2017, vol. 46, issue 6, 1133-1141

Abstract: This paper studies the interplay between two defining features of technology-based firms: licensing as a commercialization strategy and the reliance on equity financing. Within the context of an IPO, we argue that the technology commercialization strategy of a firm going public affects information asymmetries and, therefore, IPO underpricing. In particular, we theorize that underpricing will be higher when a firm’s technology commercialization strategy is more based on licenses. We also posit that the size of the patent portfolio will mitigate this effect. Our results from a sample of 130 IPOs in the U.S. semiconductor industry confirm these predictions.

Keywords: Initial public offering (IPO); Underpricing; License; Patent; Semiconductor; Endogeneity (search for similar items in EconPapers)
JEL-codes: G32 L24 L63 M13 O32 O34 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:respol:v:46:y:2017:i:6:p:1133-1141

DOI: 10.1016/j.respol.2017.04.006

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