The Impact of Asymmetric Information on Optimal Investments, Learning and Exit Outcomes
Description
This book analyzes the VC‘s role as a monitoring agent and a certifying agent in the relationship with the entrepreneur. It is focused on the impact of asymmetric information on optimal investments, learning, and exit outcomes in this context.
The research results show that agency costs of the VC are time-variant, the information rent earned by the VC in a funding relationship is biased under asymmetric Information and certification by the VC in the exit phase is most important if new investors face high search and screening costs.
Overview
1 Introduction
2 Moral Hazard in VC Finance
Introduction – Formal Model – Empirical Approach – Conclusion
3 Learning in Funding Relationships
Introduction – Learning and Comprehensiveness – Frictions in the Learning Process – Formal Hypotheses – Data and Methodology – Results – Conclusion
4 VCs as Intermediaries in Exits
Introduction – Agency Cost in IPO and Trade Sale Exits – Investor Characteristics – Firm Characteristics – Sample and Methodology – Results – Conclusion
5 Conclusion
Summary of the Main Results – Outlook
Bibliography
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