Nothing Special   »   [go: up one dir, main page]

Skip to main content

The Evaluation of Venture-Backed IPOs – Certification Model versus Adverse Selection Model, Which Does Fit Better?

  • Conference paper
Data Analysis, Machine Learning and Applications

Abstract

In this paper we aim to investigate the consistency of the certification model against the adverse selection model with respect to the operational performances of venture-backed (VB) IPOs. We analyse a set of economic-financial variables an italian IPOs sample between 1995 and 2004. After non-parametric tests, to take into account the non-normal, multivariate nature of the problem, we propose a non-parametric regression model, i.e. Partial Least Squares, as appropriate investigative tool.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Subscribe and save

Springer+ Basic
$34.99 /Month
  • Get 10 units per month
  • Download Article/Chapter or eBook
  • 1 Unit = 1 Article or 1 Chapter
  • Cancel anytime
Subscribe now

Buy Now

Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 129.00
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD 169.99
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

Similar content being viewed by others

References

  • BARRY, C., MUSCARELLA, C., PEAVY, J. and VETSUYPENS, M. (1990): The role of ven-ture capital in the creation of public companies. Evidence from the going public process. Journal of Financial Economics, 27, pp. 447-471.

    Article  Google Scholar 

  • BENNINGA, S., HELMANTEL, M. and SARIG, O. (2005): The timing of initial public of-fering. Journal of Financial Economics, 75, pp. 115-132.

    Article  Google Scholar 

  • BRAU, J., BROWN, R. and OSTERYOUNG, J. (2004): Do venture capitalists add value to small manufacturing firms? An empirical analysis of venture and non-venture capital-backed initial public offerings. Journal of Small Business Management, 42, pp. 78-92.

    Article  Google Scholar 

  • COAKLEY, J., HADASS, L. and WOOD, A. (2004): Post-IPO operating performance, ven-ture capitalists and market timing. Department of Accounting, Finance and Management, University of Essex, pp. 1-32.

    Google Scholar 

  • DEL COLLE, D.M., FINALI RUSSO, P. and GENERALE, A. (2006): The causes and conse-quences of venture capital financing. An analysis based on a sample of italian firms. Temi di discussione Banca d’Italia, 6-45.

    Google Scholar 

  • DURAND, J.F. (2001): Local Polynomial additive regression through PLS and Splines: PLSS. Chemometrics & Intelligent Laboratory Systems, 58, pp. 235-246.

    Article  Google Scholar 

  • GOMPERS, P. (1996): Grandstanding in the venture capital industry. Journal of Financial Economics, 42, pp. 1461-1489.

    Article  Google Scholar 

  • JAIN, B. and KINI, O. (1995): Venture capitalist participation and the post-issue operating performance of IPO firms.Managerial and Decision Economics, 16, pp. 593-606.

    Article  Google Scholar 

  • LEE, P. and WAHAL, S. (2004): Grandstanding, certification and the underpricing of venture capital backed IPOs. Journal of Financial Economics, 73, pp. 375-407.

    Article  Google Scholar 

  • MANN, H.B. and WHITNEY, D.R. (1947): On a test of whether one of 2 random variables is stochastically larger than the other. Annals of mathematical statistics, 18, pp. 50-60.

    Article  MATH  MathSciNet  Google Scholar 

  • MEGGINSON, W., WEISS, K. (1991): Venture capital certification in initial public offerings. Journal of Finance, 46, pp. 879-903.

    Article  Google Scholar 

  • RAJAN, R. G. and ZINGALES, L. (2003): Saving capitalism from the capitalists. Einaudi, Torino.

    Google Scholar 

  • SAHLMAN, W.A. (1990): The structure and governance of venture-capital organiza-tions.Journal of Financial Economics, 27.

    Google Scholar 

  • TENENHAUS, M. (1998): La Regression PLS, Theorie et Pratique. Editions Technip, Paris.

    MATH  Google Scholar 

  • WANG, C., WANG, K. and LU, Q. (2003): Effects of venture capitalists’ participation in listed companies.Journal of Banking & Finance, 27, pp. 2015-2034.

    Article  Google Scholar 

  • WILCOXON, F. and WILCOX, A.R. (1964): Some rapid approximate statistical procedures. Lederle Lab., Pearl River N.Y.

    Google Scholar 

Download references

Author information

Authors and Affiliations

Authors

Editor information

Editors and Affiliations

Rights and permissions

Reprints and permissions

Copyright information

© 2008 Springer-Verlag Berlin Heidelberg

About this paper

Cite this paper

Gangi, F., Lombardo, R. (2008). The Evaluation of Venture-Backed IPOs – Certification Model versus Adverse Selection Model, Which Does Fit Better?. In: Preisach, C., Burkhardt, H., Schmidt-Thieme, L., Decker, R. (eds) Data Analysis, Machine Learning and Applications. Studies in Classification, Data Analysis, and Knowledge Organization. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-540-78246-9_60

Download citation

Publish with us

Policies and ethics