Risk‐Adjusting the Returns to Venture Capital
نویسندگان
چکیده
منابع مشابه
Returns to Venture Capital
The returns to private equity investment have become a vexed issue, attracting widespread debate in the media, government, and among researchers. Much of the attention has focused on later-stage buyout investments, but there is a general move towards greater transparency and disclosure of the returns to both early and late-stage venture capital (VC) investments. Shortcomings in the information ...
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dh No. 71 1 The stories of Google and Segway certainly end differently. With a market capitalization of over $180 billion, Google is arguably the biggest success in the information technology (IT) industry in the last decade. The phrase google it has worked its way into everyday language and dictionaries. On the other hand, Segway remains a privately held company whose products are largely rele...
متن کاملThe Venture Capital Revolution
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متن کاملOn the Return to Venture Capital∗
This paper provides a theory that explains the sizeable excess return to venture equity, and ties it to the high VC discount rates, i.e., to VC impatience. The theory is based on the shortage of venture capitalists (VCs) — people who have the expertise to assess the profitability of projects, and have liquidity to finance them. A VC must supply not only money but also his time, and it is the sc...
متن کاملOn the Return to Venture Capital 1
We provide a model that links the high return to venture equity to the impatience of the VCs. VCs are scarce, and hence, they have market power and a high return on their investments. As a result, VCs are eager to terminate non-performing ventures so they can move on to new ones. The scarcity of VCs enables them to internalize their social value, and the competitive equilibrium is socially opti...
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ژورنال
عنوان ژورنال: The Journal of Finance
سال: 2016
ISSN: 0022-1082,1540-6261
DOI: 10.1111/jofi.12390