The ability of capital markets to distinguish firms of different value by the size of their initial equity offerings is attenuated when insiders can sell equity more than once. A model is developed in which there is price risk from holding equity between periods. When the uncertainty is small....

The ability of capital markets to distinguish firms of different value by the size of their initial equity offerings is attenuated when insiders can sell equity more than once. A model is developed in which there is price risk from holding equity between periods. When the uncertainty is small....

This paper examines external financing of small and growth firms using a regulatory experiment in the US microcap market. The paper focuses on a new financing method for entrepreneurial firms – small public offerings under Regulation A, which was significantly expanded by 2015 amendments....