Venture Capital and Other Private Equity: A Survey

56 Pages Posted: 12 Dec 2010  

Andrew Metrick

Yale School of Management; National Bureau of Economic Research (NBER)

Ayako Yasuda

University of California, Davis - Graduate School of Management

Multiple version iconThere are 3 versions of this paper

Date Written: December 9, 2010

Abstract

We review the theory and evidence on venture capital (VC) and other private equity: why professional private equity exists, what private equity managers do with their portfolio companies, what returns they earn, who earns more and why, what determines the design of contracts signed between (i) private equity managers and their portfolio companies and (ii) private equity managers and their investors (limited partners), and how/whether these contractual designs affect outcomes. Findings highlight the importance of private ownership, and information asymmetry and illiquidity associated with it, as a key explanatory factor of what makes private equity different from other asset classes.

Keywords: Private Equity, Venture Capital, Buyouts, Alternative Assets

JEL Classification: G2, G3, G24, G32, G34

Suggested Citation

Metrick, Andrew and Yasuda, Ayako, Venture Capital and Other Private Equity: A Survey (December 9, 2010). Available at SSRN: https://ssrn.com/abstract=1723882 or http://dx.doi.org/10.2139/ssrn.1723882

Andrew Metrick

Yale School of Management ( email )

165 Whitney Avenue
New Haven, CT 06511
United States
(203)-432-3069 (Phone)

HOME PAGE: http://faculty.som.yale.edu/andrewmetrick/

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Ayako Yasuda (Contact Author)

University of California, Davis - Graduate School of Management ( email )

One Shields Avenue
Davis, CA 95616
United States
530-752-0775 (Phone)
530-752-2924 (Fax)

HOME PAGE: http://www.ayakoyasuda.com

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