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We analyze the relationship between contracts and returns in private equity (PE) investments. Contractual control in the form of covenants tends to be employed to identify good deals. Better quality firms are more likely to have covenant-rich contracts, as they are less concerned by the...
Persistent link: https://www.econbiz.de/10013095256
This paper is the first systematic analysis of the impact of diversification on the performance of private equity funds. A unique data set allows the exact evaluation of diversification across the dimensions financing stages, industries, and countries. Very different levels of diversification...
Persistent link: https://www.econbiz.de/10010383033
In this paper, I extend the results of Moskowitz and Vissing-Jørgensen (2002) on the returns to entrepreneurial investments in the United States. First, following the authors' methodology I replicate the original findings from the Survey of Consumer Finances (SCF) for the period 1989 - 1998 and...
Persistent link: https://www.econbiz.de/10008841171
This paper analyzes the determinants of returns generated by European private equity funds. It starts from the presumption that this asset class is characterized by illiquidity, stickiness and segmentation. As a consequence, Gompers and Lerner (2000) have shown that venture deal valuations are...
Persistent link: https://www.econbiz.de/10009231546
This paper presents a cash flow based analysis of the return and risk characteristics of European Private Equity Funds. For that purpose a comprehensive data set has been provided by Thomson Venture Economics. We document the typical time pattern of cash flows for European private equity funds....
Persistent link: https://www.econbiz.de/10009231547
We review the theory and evidence on venture capital (VC) and other private equity: why professional private equity exists, what private equity managers do with their portfolio companies, what returns they earn, who earns more and why, what determines the design of contracts signed between (i)...
Persistent link: https://www.econbiz.de/10013135193
This study demonstrates that the ownership of private equity (PE) funds influences investment performance. The analysis focuses on the universe of PE investments made by Italian closed-end funds from 1999 to 2005. We find that bank-owned funds generally engage in weaker monitoring of the firms...
Persistent link: https://www.econbiz.de/10013140087
Despite an increasing importance of secondary buyouts in the private equity market, little is known about the perspective of the seller and his motives for choosing this exit type. Do private equity firms have a clear pecking order regarding the exit channels for their portfolio companies? Is a...
Persistent link: https://www.econbiz.de/10013106072
This paper examines diversification as a source of value creation and destruction in private equity (PE) funds. Previous literature has focused on the ‘diversification discount' in corporations. However, in PE funds, diversification might increase returns by ameliorating managerial risk...
Persistent link: https://www.econbiz.de/10013069016
This paper investigates determinants and consequences of net asset value discounts in listed private equity funds. Listed private equity funds share characteristics of closed-end mutual funds and traditional unlisted private equity funds and can therefore offer insights into both. Our results...
Persistent link: https://www.econbiz.de/10013150504