545 research outputs found
Comparative Venture Capital Governance. Private versus Labour Sponsored Venture Capital Funds
Private independent limited partnership venture capital funds receive capital from institutional investors, without tax incentives. Limited partnership investment activities are governed by restrictive covenants that are determined by negotiated contract between the fund managers (general partners) and the institutional investors (limited partners). By contrast, Canadian Labour Sponsored Venture Capital Corporations (LSVCCs) receive capital only from individual investors who receive tax breaks on capital contributions of up to CAN$5,000. LSVCC investment activities are governed by statutory restrictions. This chapter contrasts the governance of LSVCCs to limited partnerships. We also summarize Canadian evidence on the impact of LSVCC governance and tax incentives: (1) on the distribution of venture capital funding between private and LSVCC funds; (2) on the unusually large overhang of uninvested capital in the Canadian venture capital industry; (3) the portfolio size (i.e. number of investee firms per fund) of private funds versus LSVCCs; and (4) the performance of LSVCCs relative to other types of venture capital organiziations and other comparable investments for individual investors.venture capital, Canada, tax, government, crowding out, portfolio size, governance
Measuring the Effect of Bankruptcy Laws on Entrepreneurship Across Countries
Two recent papers examine the impact of corporate bankruptcy laws on new business start-ups in 29 countries over 1990 - 2008 (Peng et al., 2010; Lee et al., 2010). In this commentary, I briefly point out two significant issues which future researchers might want to consider. First, several countries in the data examined had changed their personal and corporate bankruptcy laws over the years studied. It is statistically inappropriate and inaccurate to treat bankruptcy laws as time invariant, as in Peng et al. (2010) and Lee et al. (2010), particularly in view of the dramatic changes in bankruptcy laws over time in so many countries. Second, Peng et al. (2010) and Lee et al. (2010) have a misplaced focus on corporate bankruptcy law while ignoring personal bankruptcy law. This focus is at odds with theory and prior work on topic which relates entrepreneurship to personal bankruptcy law
Contracts and Exits in Venture Capital Finance
Contracts and exits from a sample of 179 investment rounds in 132 entrepreneurial firms
by 17 European venture capital (VC) funds are analyzed. The data indicate the financial contracts
are quite heterogeneous in terms of both the cash flow and control rights. The use of different
securities by European VC funds does not depend on the definition of venture capital, and the
securities used are not functional equivalents. A normative empirical analysis of exit shows the
likelihood of different types of exit vehicles (IPO, acquisition, and liquidation) and the returns to
venture capital depend on not only firm specific characteristics but also the allocation of cash
flow and control rights.
Keywords: Venture Capital, Financial Contracting, Exit, IPO, Acquisition
JEL Classification: G24, G28, G31, G32, G3
Equity crowdfunding and governance : toward an integrative model and research agenda
Equity crowdfunding markets have grown exponentially over the last few years. Despite this impressive growth, significant informational asymmetry problems may plague these markets, making them susceptible to difficulties and even market failure. In this paper, we depart from current equity crowdfunding research that focuses almost exclusively on the funding success and funding dynamics on platforms to study the effective governance of equity-crowdfunded (ECF) firms and how it relates to these firmsâ success. We propose a conceptual model that identifies a multitude of governance mechanisms (e.g., internal or external and formal or informal) that potentially operate in equity crowdfunding markets to reduce adverse selection and moral hazard problems. Further, building on this framework, we offer a roadmap for future research that examines how different governance mechanisms may help in the selection and development of successful ECF firms
The wild west of ICOs
This chapter sets out to establish the key issues that have become central within the market
for Initial Coin Offerings (ICOs). Within this context, we provide a brief overview of the existing
literature based on ICOs around the world, while explaining the motivations and styles of criminality
that have occurred, the methods that have been widely used by cryptocurrency thieves, the potential
for the innovation of theft within the sector and the related problems that such technological
progress can potentially generate, and the types of market agents that have set out to potentially
misuse ICOs for a variety of reasons at both the sovereign and corporate level. As cryptocurrency
markets continue to evolve, it is imperative that policy-makers and regulators continue to monitor
the potential development of sophisticated manipulation and cybercriminality techniques that have
developed throughout the market for cryptocurrencies
Timing and location of reproduction in African waterfowl: an overview of >100 years of nest records
The timing and location of reproduction are fundamental elements of reproductive success for all organisms. Understanding why animals choose to reproduce at particular times and in particular places is also important for our understanding of other aspects of organismal ecology, such as their habitat requirements, movement strategies, and biogeography. Although breeding patterns in waterfowl are relatively well documented, most studies are from northern temperate regions and the influences of location and time of year on breeding in Afrotropical ducks (Anatidae) are poorly understood. We outline six alternative (but not mutually exclusive) hypotheses that might explain where and when Afrotropical ducks choose to breed. To explore these hypotheses, we assembled and analyzed a new database of c.22,000 breeding records for 16 Afrotropical ducks and one introduced Palearctic species (the Mallard Anas platyrhynchos). The full database is available on line as an appendix to this article. We identified five distinct breeding strategies as well as two outliers. Peak breeding for 9 of 16 indigenous duck species occurs during the dry season. We found no evidence for spatial synchrony or spatial autocorrelation in breeding, suggesting a high level of flexibility in waterfowl responses to prevailing conditions in any given year. More intensive analyses of alternative hypotheses are needed, but our initial analysis suggests that the timing of breeding for the majority of Afrotropical ducks is driven by a combination of resource availability and predation risk
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