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What Happed to Companies Backed by Venture Capital Following IPO?

In: New Challenges in Entrepreneurship and Finance

Author

Listed:
  • Moez Khalfallah

    (Cergy Pontoise University)

  • Jean-Michel Sahut

    (IPAG Business School)

Abstract

This paper examines changes in profitability of 146 Companies financed by Venture Capital (CVC) listed on the French market. The results show disappointing post-IPO profitability. The decline in performance ranges from 9.5 % to 32 % over a 2-year period following the launch on the stock exchange. It also appears that the decline in operating performance is less significant for CVC compared with non CVC over the same period. An analysis of this underperformance shows that CVC supported by reputed venture capital firms manage to limit the decline in operating performance compared to those supported by non-reputed venture capital firms.

Suggested Citation

  • Moez Khalfallah & Jean-Michel Sahut, 2015. "What Happed to Companies Backed by Venture Capital Following IPO?," Springer Books, in: Marta Peris-Ortiz & Jean-Michel Sahut (ed.), New Challenges in Entrepreneurship and Finance, edition 127, chapter 0, pages 87-101, Springer.
    • Handle: RePEc:spr:sprchp:978-3-319-08888-4_6
    DOI: 10.1007/978-3-319-08888-4_6
    as

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