I study the causes and consequences of staging in the setting of private investments in public equities (PIPEs). I find that similar to venture capital staging, in the PIPE investments, staging is used by investors as a monitoring mechanism to mitigate the information and agency problem....

We propose a model that examines the optimal size of venture capital and private equity fund portfolios. The relationship between a VC and entrepreneurs is characterized by double-sided moral hazard, which causes the VC to trade off larger portfolios against lower values of portfolio companies....