Early-stage financing and firm growth in new industries

• 成果类型: Article
• 署名作者: Inderst, Roman; Mueller, Holger M.
• 署名单位: New York University; Goethe University Frankfurt; Centre for Economic Policy Research - UK; European Corporate Governance Institute; National Bureau of Economic Research
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2008.07.004
• 发表日期: 2009
• 页码: 276-291
• 关键词: venture capital; Dynamic investment; Product market competition

摘要

This paper shows that active investors, such as venture capitalists, can affect the speed at which new ventures grow. in the absence of product market competition, new ventures financed by active investors grow faster initially, though in the long run those financed by passive investors are able to catch up. By contrast, in a competitive product market, new ventures financed by active investors may prey on rivals that are financed by passive investors by strategically overinvesting early on, resulting in long-run differences in investment, profits, and firm growth. The value of active investors is greater in highly competitive industries as well as in industries with learning curves, economies of scope, and network effects, as is typical for many new economy industries. For such industries, our model predicts that start-ups with access to venture capital may dominate their industry peers in the long run. (C) 2009 Elsevier B.V. All rights reserved.