Asset liquidity and venture capital investment

Giang Nguyen, Vinh Vo

Research output: Contribution to journalArticlepeer-review

1 Citation (Scopus)

Abstract

We examine the relationship between asset market liquidity and venture capital (VC) investment and find that it is inverted U-shaped. Asset liquidity and VC investment are positively related for low levels of asset liquidity but negatively related for higher levels of asset liquidity. We also document evidence that VC firms with more industry experience invest more in a liquid asset market than those without industry experience or with significant experience in other industries. Portfolio companies obtained their first investment in a liquid asset market are less likely to exit successfully; however, given a successful exit, they prefer to exit through mergers and acquisitions rather than going public.

Original languageEnglish
Article number101963
JournalJournal of Corporate Finance
Volume69
DOIs
Publication statusPublished - 2021 Aug

Keywords

  • Asset liquidity
  • Experience
  • Investment
  • Success
  • Venture capital

ASJC Scopus subject areas

  • Business and International Management
  • Finance
  • Economics and Econometrics
  • Strategy and Management

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