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Does Venture Capital Syndication Spur Employment Growth and Shareholder Value? : evidence from German IPO Data

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  • Erik Lehmann

    ()
    (Department of Economics, University of Konstanz)

Abstract

This study examines empirically the syndication of equity by multiple venture capitalists in Germany. Following the literature, there are mainly two competing views as to why venture capitalists syndicate investments. First, syndication can be viewed as a means of risk-sharing. Second, venture capitalists may provide important productive resources to firms, capital and information. We test hypotheses based on these two aspects. The results show that the syndication of equity and the number of venture capitalists involved cannot be fully explained by firm characteristics like size, age or industry affiliation. Although syndicated investments do not differ significantly in stock-market performance, they show significantly higher growth rates.

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Bibliographic Info

Paper provided by Research Group Heterogeneous Labor, University of Konstanz/ZEW Mannheim in its series Working Papers of the Research Group Heterogenous Labor with number 04-11.

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Length: 31 pages
Date of creation: 11 May 2004
Date of revision:
Handle: RePEc:knz:hetero:0411

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Keywords: Venture Capital ; Human Capital ; Syndication ; Firm Performance;

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References

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Cited by:
  1. Haizhi Wang & Robert Wuebker & Shu Han & Michael Ensley, 2012. "Strategic alliances by venture capital backed firms: an empirical examination," Small Business Economics, Springer, vol. 38(2), pages 179-196, February.
  2. Younghoon Kim & Yeonbae Kim & Jeong‐Dong Lee, 2011. "Corporate Venture Capital and Its Contribution to Intermediate Goods Firms in South Korea," Asian Economic Journal, East Asian Economic Association, vol. 25(3), pages 309-329, 09.

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