Where Have All the IPOs Gone
TLDR
In this article, the authors propose an alternative explanation for the decline in the number of initial public offerings in the United States: the advantages of selling out to a larger organization, which can speed a product to market and realize economies of scope, have increased relative to the benefits of operating as an independent firm.Abstract:
During 1980–2000, an average of 310 companies per year went public in the United States. Since 2000, the average has been only 99 initial public offerings (IPOs) per year, with the drop especially precipitous among small firms. Many have blamed the Sarbanes-Oxley Act of 2002 and the 2003 Global Settlement’s effects on analyst coverage for the decline in IPO activity. We find very little support for the conventional wisdom, and we offer an alternative explanation. Our economies of scope hypothesis posits that the advantages of selling out to a larger organization, which can speed a product to market and realize economies of scope, have increased relative to the benefits of operating as an independent firm.read more
Citations
More filters
Journal ArticleDOI
How does national culture influence IPO underpricing
TL;DR: In this paper, the authors examine how national culture affects the international underpricing of initial public offerings (IPOs) and hypothesize that cultural norms and beliefs informally influence human perceptions, such as risk tolerance, motivations, and perceived options, and thus affect behavior.
Journal ArticleDOI
From Bit To Bedside: A Practical Framework For Artificial Intelligence Product Development In Healthcare.
David Higgins,Vince I. Madai +1 more
TL;DR: A “decision perspective” framework for the development of AI‐driven biomedical products from conception to market launch is presented and should be seen as a template for innovation frameworks, which can be used to coordinate team communications and responsibilities toward a viable product development roadmap, thus unlocking the potential of AI in medicine.
Journal ArticleDOI
Ball and Brown (1968) after fifty years
Ray Ball,Philip Brown +1 more
TL;DR: The replication of Ball and Brown (1968) for a special issue of the Pacific-Basin Finance Journal commemorating the 50th anniversary of its publication is described in this paper.
Journal ArticleDOI
Explaining IPO initial returns in Malaysia: ex ante uncertainty vs signalling
TL;DR: In this article, the authors investigated whether pre-initial public offering (IPO) financial performance, measured by Altman Z-score, can serve as a proxy for ex ante uncertainty or signalling in an IPO market where a fixed price mechanism is used to determine the offer price.
Journal ArticleDOI
Mutual fund investments in private firms
TL;DR: In this article, the authors evaluate several factors that potentially contribute to this trend: firms seeking extra capital to postpone public listing, mutual funds seeking higher risk-adjusted returns and initial public offering (IPO) allocations, and venture capitalists (VCs) seeking new investors to substantiate higher valuations.
References
More filters
Journal ArticleDOI
The structure and governance of venture-capital organizations
TL;DR: The authors describes and analyzes the structure of VC organizations, focusing on the relationship between investors and venture capitalists and between venture-capital firms and the ventures in which they invest, and contrasts VC organizations with large, publicly traded corporations and with leveraged buyout organizations.
Journal ArticleDOI
Have Individual Stocks Become More Volatile? An Empirical Exploration of Idiosyncratic Risk
TL;DR: In this paper, the authors used a disaggregated approach to study the volatility of common stocks at the market, industry, and firm levels and found that over the period from 1962 to 1997 there has been a noticeable increase in firm-level volatility relative to market volatility.
Journal ArticleDOI
Do Brokerage Analysts' Recommendations Have Investment Value?
TL;DR: In this article, an analysis of new buy and sell recommendations of stocks by security analysts at major U.S. brokerage firms shows significant, systematic discrepancies between pre-recommendation prices and eventual values.
Journal ArticleDOI
Venture capitalists and the decision to go public
TL;DR: This article examined the timing of initial public offerings and private financings by venture capitalists and found that seasoned VCs are particularly proficient at taking companies public near market peaks, and that these companies go public when equity valuations are high and employ private finance when values are lower.