The Valuation Effect of Listing Standards: An Analysis of Venture Capital-Backed IPOs
42 Pages Posted: 7 Aug 2009 Last revised: 12 Apr 2012
Date Written: March 8, 2010
This paper examines the valuation of venture capital (VC)-backed IPOs in Canada and the US over the 1986-2007 period. The data indicate that differences in listing standards between Canada and the US account for fact that IPOs are valued substantially lower in Canada. We consider alternative matched samples based on factors that include size, sector and expected liquidity, and consider several alternative explanations that might affect IPO valuations, including the quality of the issuer, VC and investment bank, as well as mispricing, liquidity, and clientele effects.
Keywords: Securities regulation, Valuation, Initial Public Offerings, Venture capital, Listing Standards
JEL Classification: G24, G32, G14, G15
Suggested Citation: Suggested Citation