Bank versus venture capital

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Journal of Finance 59(2), 601-621, 2004
http://hdl.handle.net/10230/845
To cite or link this document: http://hdl.handle.net/10230/845
dc.contributor.author Ueda, Masako
dc.contributor.other Universitat Pompeu Fabra. Departament d'Economia i Empresa
dc.date.issued 2000-11-01
dc.identifier.citation Journal of Finance 59(2), 601-621, 2004
dc.identifier.uri http://hdl.handle.net/10230/845
dc.description.abstract Why do some start-up firms raise funds from banks and others from venture capitalists? To answer this question, I develop a model of start-up financing when intellectual property rights are not well protected. The upside of VC financing is that the VC understands the business better than a bank. The downside, however, is that the VC may steal the idea and use it himself. The results of the model are consistent with empirical regularities on start-up financing. The model implies that the characteristics of the firms financing from venture capitalists are low-collateral, high-growth and high-profitability. The model also suggests that the tighter protection of intellectual property rights contributes to the recent dramatic growth of the US venture capital industry.
dc.language.iso eng
dc.relation.ispartofseries Economics and Business Working Papers Series; 522
dc.rights L'accés als continguts d'aquest document queda condicionat a l'acceptació de les condicions d'ús establertes per la següent llicència Creative Commons
dc.rights.uri http://creativecommons.org/licenses/by-nc-nd/3.0/es/
dc.title Bank versus venture capital
dc.title.alternative Banks versus Venture Capital: Project Evaluation, Screening, and Expropiation
dc.type info:eu-repo/semantics/workingPaper
dc.date.modified 2014-06-03T07:14:03Z
dc.subject.keyword Finance and Accounting
dc.subject.keyword collateral
dc.subject.keyword intellectual-property
dc.subject.keyword venture-capital
dc.rights.accessRights info:eu-repo/semantics/openAccess


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