The Performance of Listed European Innovative Firms
in Beccalli E., Poli F. (ed), Lending, Investments and the Financial Crisis, Palgrave Macmillian, 2015
Posted: 15 Jan 2015 Last revised: 24 Nov 2015
Date Written: 2015
The paper examines the performance of European VC backed firms operating in the life science and ICT industries at IPO and in the long run. Empirical evidence shows a lower underpricing for VC backed companies and lower volatility of returns in the first days and first weeks of trading, suggesting the important role of venture capitalists in softening the asymmetries of information at IPO. The differences in performance of VC backed firms tend to disappear in the long run, as confirmed by the analysis performed considering various specification of return and risk, as well as employing a three factor market model approach.
Keywords: venture capital, IPO, VC backed, long run performance, risk adjusted performance measure, Europe
JEL Classification: G10, G24
Suggested Citation: Suggested Citation