Do International Investors Enhance Private Firm Value?
52 Pages Posted: 3 Jun 2014 Last revised: 30 Sep 2019
Date Written: May 19, 2014
We examine the impact of international venture capital investors on private firm success spanning 69 countries over the years 1995-2010. The data examined indicate that, relative to deals in which the investor base is purely domestic, private firms that have an international venture capital syndicate have a higher probability of exiting via IPO and higher IPO proceeds, as well as higher total deal M&A values. These relationships, however, depend on the level of internationalization and hence imply a tradeoff between the strategic benefits associated with international investors and the costs associated with geographic, cultural and legal differences across countries.
Keywords: Venture Capital, Syndication, Acquisition, Portfolio Company, Deal Value, Proceeds
JEL Classification: E6, G2, K2
Suggested Citation: Suggested Citation