Human Resources in Initial Public Offering Firms: Do Venture Capitalists Make a Difference?

2000 ◽  
Vol 25 (1) ◽  
pp. 77-92 ◽  
Author(s):  
Linda A. Cyr ◽  
Diane E. Johnson ◽  
Theresa M. Welbourne
Keyword(s):  
Human Resources ◽  
Initial Public Offering ◽  
Top Management Team ◽  
Vice President ◽  
Strategic Human Resource Management ◽  
Management Team ◽  
Superior Performance ◽  
Venture Capitalists ◽  
Management Literature ◽  
Public Offering

Venture capitalists’ preference for complete, well-balanced founding teams is well established. In addition, the strategic human resource management literature posits that superior performance might accrue to firms that have a member of the top management team responsible for human resources. In this paper, we test whether or not venture capitalist backing affects the likelihood that initial public offering firms will report having a vice president of human resources. We also examine the combined effect on performance as a result of being venture capital-backed and having a vice president of human resources.

scholarly journals Top Management Team Quality and Innovation in Venture-Backed Private Firms and IPO Market Rewards to Innovative Activity

2020 ◽  
pp. 104225872091882 ◽  
Author(s):  
Thomas J. Chemmanur ◽  
Manish Gupta ◽  
Karen Simonyan
Keyword(s):  
Initial Public Offering ◽  
Top Management Team ◽  
Top Management Teams ◽  
Management Team ◽  
Private Firms ◽  
Top Management ◽  
Management Quality ◽  
Public Offering ◽  
Market Valuations

Using hand-collected data on top management team human capital (“top management quality”) of a large venture-backed private firm sample, we analyze the relation between top management team quality and pre-initial public offering (IPO) innovation productivity and the relation between pre-IPO innovation productivity and IPO market valuations. We hypothesize that firms with higher quality top management teams invest more in innovative projects and select better projects, yielding higher innovation productivity; pursue explorative rather than exploitative innovation strategies; and hire more high quality inventors. Finally, we hypothesize that IPO market rewards more innovative private firms with higher IPO firm valuations. The evidence supports these hypotheses.

Top Management Team Characteristics and Organizational Virtue Orientation: An Empirical Examination of IPO Firms

2018 ◽  
Vol 28 (4) ◽  
pp. 427-461 ◽  
Author(s):  
Robert E. Evert ◽  
G. Tyge Payne ◽  
Curt B. Moore ◽  
Michael S. McLeod
Keyword(s):  
Initial Public Offering ◽  
Top Management Team ◽  
Management Team ◽  
Top Management ◽  
Organizational Size ◽  
Empirical Examination ◽  
Upper Echelon Theory ◽  
Values And Beliefs ◽  
And Gender ◽  
Public Offering

ABSTRACT:Despite extensive research on organizational virtue, our understanding about factors that promote virtue within organizations remains unclear. Drawing on upper echelon theory, we examine the relationship between five top management team (TMT) characteristics and organizational virtue orientation (OVO)—the integrated set of values and beliefs that support ethical traits and virtuous behaviors of an organization. Specifically, we utilize prospectuses of initial public offering (IPO) firms and 10-K post-IPO filings to explore how TMT composition with respect to member age, tenure, education, functional background, and gender influences OVO. Additionally, we examine the moderating effects of organizational size, and argue that the more expansive structures and processes associated with larger organizations diminish the main relationships. Our findings, using two sources of data, are consistent, but somewhat mixed in their support for our hypotheses. Overall, TMT characteristics do appear to influence OVO, but in more complex and counterintuitive ways than initially expected.

The Evolving Role of the Chief Information Officer (CIO)

2015 ◽  
pp. 207-232
Author(s):  
Brian Davis ◽  
Joe McDonagh
Keyword(s):  
Top Management Team ◽  
Chief Information Officer ◽  
Management Team ◽  
Top Management ◽  
Technological Environment ◽  
Manager Role ◽  
Is Management ◽  
Management Literature ◽  
Line Manager

The new role of CIO was created in the early 1980s, a time when organizations had just begun to recognize the strategic importance of IS. Prior to that, the most senior role in IS had been that of the IS Manager, a functional or line manager role with only limited involvement with top management. This new role was expected to work within the top management team to “bridge the gap” between the IS department and top management, to ensure the ongoing successful exploitation of IS across the organization. Today, it has been suggested that the role of CIO has now evolved to cover the need to also “bridge the gap” between the organization itself and its external IS technological environment. The purpose of this chapter is to review the IS management literature relating to the CIO in order to gain a greater understanding of the evolution of this role.

scholarly journals Exit Decision of Venture Capital Based on Linear Contract in Continuous Time: IPO or M&A

Complexity ◽  
2020 ◽  
Vol 2020 ◽  
pp. 1-19
Author(s):  
Ding Chuan ◽  
Dahai Li ◽  
Meishu Ye
Keyword(s):  
Social Welfare ◽  
Venture Capital ◽  
Interest Rates ◽  
Initial Public Offering ◽  
Continuous Time ◽  
Production Efficiency ◽  
Venture Capitalists ◽  
Social Welfare Maximization ◽  
Incentive Problem ◽  
Public Offering

Based on the assumption that the long-term value of a venture capital satisfies the algebraic Brownian motion, we develop a continuous-time exit model of venture capital under different exit modes, namely, initial public offering (IPO) and mergers and acquisitions (M&A). The employee incentive problem is analyzed jointly with the exit decision of the firm in terms of the exit timing and the exit mode. Further, the problem of capital exit is considered from two perspectives, namely, optimal venture capital and social welfare maximization, and the differences between these exit decisions are compared. Our model predicts that the timing of an IPO, the purpose of which is to maximize the utility of the capitalists, lags behind the exit timing, whose purpose is to maximize social welfare. Using a numerical analysis, this paper also proves that increasing the production efficiency, lowering the interest rates, and improving risk management can make the exit decision of venture capitalists converge with that of maximizing social welfare.

INITIAL PUBLIC OFFERINGS AND PRE-IPO SHAREHOLDERS: ANGELS VERSUS VENTURE CAPITALISTS

2012 ◽  
Vol 17 (04) ◽  
pp. 1250022 ◽  
Author(s):  
WILLIAM C. JOHNSON ◽  
JEFFREY E. SOHL
Keyword(s):  
Initial Public Offerings ◽  
Initial Public Offering ◽  
Early Stage ◽  
Equity Capital ◽  
Venture Capitalists ◽  
Public Offerings ◽  
Corporate Investors ◽  
Public Offering ◽  
Angel Investors

At the time of an initial public offering, shares in a firm are typically held by venture capitalists, insiders, corporate investors and angel investors. We examine the role of angel investors in the IPO process. We find that angel investors provide equity capital in industries venture capitalists are less likely to serve and that shareholders in angel backed IPO firms are more likely to sell their shares at the time of the offering. Where venture capital backed IPO firms have higher underpricing, angel backed IPO firms do not, implying that angels may be the preferred investors for early-stage firms.

Entrepreneurial Litigation and Venture Capital Finance

2017 ◽  
Vol 52 (5) ◽  
pp. 2217-2250 ◽  
Author(s):  
Douglas Cumming ◽  
Bruce Haslem ◽  
April Knill
Keyword(s):  
Venture Capital ◽  
Initial Public Offering ◽  
Venture Capitalists ◽  
Public Offering

This article empirically examines the interaction between entrepreneurial plaintiff firm litigation and venture capital (VC). The data indicate that, relative to nonplaintiffs, firms that litigate prior to (after) obtaining VC i) receive financing from less (more) reputable venture capitalists (VCs), ii) are subject to greater (similar) oversight by VCs, iii) receive less (more) VC funding, iv) are more likely to exit through an initial public offering than through an acquisition, and v) are less likely to be liquidated when litigation occurs after VC financing. The results are robust to different specifications, methodologies, and endogeneity checks.

scholarly journals Employee Rewards And The Likelihood Of A Successful Initial Public Offering

2011 ◽  
Vol 6 (9) ◽  
Author(s):  
Greg Filbeck ◽  
Peg Thoms ◽  
Brian L. Boscaljon
Keyword(s):  
Human Resources ◽  
Initial Public Offering ◽  
Profit Sharing ◽  
Stock Ownership ◽  
Font Size ◽  
Compensation Structure ◽  
Employee Stock Ownership ◽  
Stock Ownership Plans ◽  
Employee Stock Ownership Plans ◽  
Public Offering

<span style="font-size: x-small;"><span style="font-family: Times New Roman;"><p class="MsoCommentText" style="text-align: justify; margin: 0in 0.5in 0pt;">In this paper, we survey employees about human resources practices regarding employee stock ownership plans (ESOPs) and profit sharing plans of firms that have registered for an IPO offering.<span style="mso-spacerun: yes;">&nbsp; </span>We find that firms that had ESOPs in place prior to the registration of an IPO have a greater likelihood of eventually launching an IPO than those registered firms who do not.<span style="mso-spacerun: yes;">&nbsp; </span>Our results broaden the existing finance literature of IPO analysis as we survey registered companies prior to their attempted IPO launch to determine whether their employee-based compensation structure impacts the likelihood of a successful IPO launch.<span style="text-decoration: underline;"></span></p></span></span>

scholarly journals The Legal and Institutional Foundations of Silicon Valley’s Technological Innovation: An Interdisciplinary Literature Review

2021 ◽  
Vol 8 (3) ◽  
pp. 472-484
Author(s):  
S. D. Stone
Keyword(s):  
Venture Capital ◽  
Technological Innovation ◽  
Initial Public Offering ◽  
Silicon Valley ◽  
Business Culture ◽  
Venture Capitalists ◽  
Board Of Director ◽  
Institutional Relations ◽  
Major Factors ◽  
Public Offering

This article reviews interdisciplinary literature to explain how state legislation and the practice of law in California influenced the success of Silicon Valley in creating a startup business culture involving the commercialization of technologies built on venture capital finance. Scholarship has identified four major factors in the rise of Silicon Valley: business culture, symbiotic institutional relations with research universities, California contract and employment law, and Silicon Valley law firm culture. Both law and institutional support have been central to the commercialization of scientific knowledge that is the hallmark of Silicon Valley. Silicon Valley companies have remained leaders in technological innovation for over sixty years, encompassing various technologies from semiconductors to personal computers to the Internet. This entrepreneurial approach to technology continues to this day as exemplified by the successful DoorDash and Airbnb IPOs launched in 2020. The paradigmatic Silicon Valley technology company consists of a small group of entrepreneurs building a start-up technology company funded by a venture capital fund. The venture capitalists (VC) maintain hands-on management of the company and receive seats on the board of director and preferred stock rights. If the business plan is successful, the company offers shares to the public through an initial public offering (IPO), or arranges additional funding from another VC fund. This Silicon Valley model is characterized by a tolerance for failure and high labor mobility. Technology company employees have the freedom to leave established companies to start their own ventures.

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