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VC Board Representation and Performance of US IPOs

Show simple item record Chahine S. Goergen M.
dc.contributor.editor 2011 2017-09-07T07:51:23Z 2017-09-07T07:51:23Z 2011
dc.identifier 10.1111/j.1468-5957.2011.02240.x
dc.description.abstract This paper studies the impact of five dimensions of venture capitalist (VC) power on the likelihood of the board representation of VCs in their portfolio firms at the initial public offering (IPO) as well as the effect of the latter on IPO performance. The dimensions of VC power are based on Finkelstein's (1992) four dimensions of power which are ownership power, structural power (i.e., the VC's rank within the firm's financial hierarchy), expert power (i.e., VC industry specialization), and prestige power (i.e., the number of IPOs the VC has been involved with so far). We add controlling power (i.e., how pivotal the VC is to the voted decision) to these four dimensions. We find that all five dimensions of power have a significantly positive impact on the likelihood of VC board membership. While controlling for the possible endogeneity of the latter, underpricing and the IPO premium are higher if there is VC board membership, which is consistent with both the grandstanding and management support hypotheses. Our results suggest that VCs improve IPO performance and that they do not just maintain a strong presence in better performing companies after the IPO. © 2011 Blackwell Publishing Ltd.
dc.format.extent Pages: (413-445)
dc.language English
dc.publisher MALDEN
dc.relation.ispartof Publication Name: Journal of Business Finance and Accounting; Publication Year: 2011; Volume: 38; no. 41702; Pages: (413-445);
dc.source Scopus
dc.title VC Board Representation and Performance of US IPOs
dc.type Article
dc.contributor.affiliation Chahine, S., Olayan School of Business, American University of Beirut, Bliss Street, Po Box 11-0236, Beirut, Lebanon
dc.contributor.affiliation Goergen, M., Olayan School of Business, American University of Beirut, Bliss Street, Po Box 11-0236, Beirut, Lebanon
dc.contributor.authorAddress Chahine, S.; Olayan School of Business, American University of Beirut, Bliss Street, Po Box 11-0236, Beirut, Lebanon; email:
dc.contributor.authorCorporate University: American University of Beirut; Faculty: Suliman S. Olayan School of Business; Department: School of Business;
dc.contributor.authorDepartment School of Business
dc.contributor.faculty Suliman S. Olayan School of Business
dc.contributor.authorInitials Chahine, S
dc.contributor.authorInitials Goergen, M
dc.contributor.authorOrcidID Goergen, Marc-0000-0003-4391-2651
dc.contributor.authorReprintAddress Chahine, S (reprint author), Amer Univ Beirut, Suliman Olayan Sch Business, Bliss St,POB 11-0236, Beirut, Lebanon.
dc.contributor.authorResearcherID Goergen, Marc-B-8379-2009
dc.contributor.authorUniversity American University of Beirut
dc.description.cited Ang J. S., 2002, J FINANC RES, V25, P1, DOI 10.1111-1475-6803.00001; BARRY CB, 1990, J FINANC ECON, V27, P447, DOI 10.1016-0304-405X(90)90064-7; Baker M, 2003, J LAW ECON, V46, P569, DOI 10.1086-380409; Boone AL, 2007, J FINANC ECON, V85, P66, DOI 10.1016-j.jfineco.2006.05.004; Brav A, 1997, J FINANC, V52, P1791, DOI 10.2307-2329465; Brooks C., 2008, INTRO ECONOMETRICS F; Bruton GD, 2010, STRATEGIC MANAGE J, V31, P491, DOI 10.1002-smj.822; Bygrave W.D., 1992, VENTURE CAPITAL CROS; BYGRAVE WD, 1988, J BUS VENTURING, V3, P137, DOI 10.1016-0883-9026(88)90023-7; CAO J, 2006, PERFORMANCE REVERSE; CARTER R, 1990, J FINANC, V45, P1045, DOI 10.2307-2328714; Casamatta C, 2003, J FINANC, V58, P2059, DOI 10.1111-1540-6261.00597; Chahine S, 2007, J BUS FINAN ACCOUNT, V34, P505, DOI 10.1111-j.1468-5957.2007.02045.x; Cornelli F, 2003, REV ECON STUD, V70, P1, DOI 10.1111-1467-937X.00235; Dalton DR, 1998, STRATEGIC MANAGE J, V19, P269, DOI 10.1002-(SICI)1097-0266(199803)19:3269
dc.description.citedCount 13
dc.description.citedTotWOSCount 7
dc.description.citedWOSCount 7
dc.format.extentCount 33
dc.identifier.scopusID 79955876028
dc.publisher.address COMMERCE PLACE, 350 MAIN ST, MALDEN 02148, MA USA
dc.relation.ispartOfISOAbbr J. Bus. Finan. Account.
dc.relation.ispartOfIssue 41702
dc.relation.ispartofPubTitle Journal of Business Finance and Accounting
dc.relation.ispartofPubTitleAbbr J. Bus. Financ. Account.
dc.relation.ispartOfVolume 38
dc.source.ID WOS:000290483200005
dc.type.publication Journal
dc.subject.otherAuthKeyword Board Membership
dc.subject.otherAuthKeyword Chief Executive Officers
dc.subject.otherAuthKeyword Ipo Premium
dc.subject.otherAuthKeyword Underpricing
dc.subject.otherAuthKeyword Venture Capital
dc.subject.otherAuthKeyword Voting Power
dc.subject.otherKeywordPlus Initial Public Offerings
dc.subject.otherKeywordPlus Venture Capital Contracts
dc.subject.otherKeywordPlus Investment Performance
dc.subject.otherKeywordPlus Empirical-Analysis
dc.subject.otherKeywordPlus Corporate-Control
dc.subject.otherKeywordPlus Firms
dc.subject.otherKeywordPlus Determinants
dc.subject.otherKeywordPlus Networks
dc.subject.otherKeywordPlus Private
dc.subject.otherKeywordPlus Certification
dc.subject.otherWOS Business, Finance

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