Veranstaltungsprogramm der VHB Jahrestagung

The digital transformation has not only lead the way to new business opportunities, but has also substantially expanded the start-up financing landscape. Crowd-based means of funding are emerging as a sustainable novel way for entrepreneurs to secure scarce early-stage financing. With venture capital still being the most important source of funding for young innovative ventures in later stages, this raises the question of potential interactions between crowdfunding and traditional forms of start-up financing. The study investigates whether professional venture investors perceive a seed-financing hierarchy by entrepreneurs, and whether this equity pecking order is affected by venture quality and could therefore serve as an uncertainty-reducing signal to prospective investors. Drawing on a choice experimental research design the study finds causal evidence that VCs believe that “lemons” (low-quality start-ups) have a higher relative likelihood than “peaches” (high-quality start-ups) of turning to crowd-based financing as a first means of external equity funding rather than turning to traditional sources, suggesting a perceived negative selection bias toward crowd-based financing. In addition to extending the pecking order framework and advancing signaling theory in the entrepreneurial setting, the study yields implications for entrepreneurs, venture investors and policy makers.

Cross-sectional evidence from former studies shows that at the end of a lockup period after an Initial Public Offering (IPO), newly listed corporations typically experience a negative share price reaction. While stock trading subsequently becomes more liquid due to the larger number of tradable shares and the illiquidity premium demanded by investors decreases, sales by existing shareholders, such as founders and senior executives, can cause these negative price reactions. Sales and the corresponding negative wealth effects seem particularly obvious, especially for unicorn IPOs valued at over $1 billion when they go public. The incentives to liquidate shares and relocate personal wealth are very high, which could lead to high sales pressure, as observed e.g. at the Facebook IPO. But, does this actually happen? We analyzed the wealth effect of lockup expirations for a sample of 128 unicorns in the pre-COVID period from late 2013 to late 2019. Our results reveal that in line with our assumption, the price corrections for unicorns are stronger than those observed for other IPOs. We conclude that after giving up their promising unicorn tag by going public, the magic of unicorns fades.

Acqui-hiring – a new human capital strategy chosen by Big Tech Silicon Valley-based companies nowadays, as acquiring and retaining high-skilled employees is getting more difficult. In these acquisitions, the focus lies not on technologies, but on people and teams. Founders play an important role, as their creativity and entrepreneurial spirit are crucial for transferring knowledge and creating value. This study empirically investigates factors that influence their retention in such acqui-hires. The dataset used in this paper is a unique and novel hand-collected full sample dataset of acquisitions conducted by Facebook and Google. Based on 454 founders from 241 companies, we analyze which factors influence the likelihood that founders stay after an acqui-hire and how their retention period can be enlarged. Our findings indicate that it is not only predetermined factors that are of relevance but also the integration choices of the acquirer – however on varying degrees, depending on the entrepreneurial personality of the founders

We explore the role of gender in new venture legitimacy, particularly pinpointing the moderating factors of gender (non-)conformity and evaluative legitimacy on venture capitalists’ perception of new venture legitimacy. Integrating gender role congruity with institutional legitimacy theory, we predict that startups led by female founder-CEOs gain more from evaluative legitimacy than their male counterparts, and that gender (non-)conformity moderates the gender-legitimacy relationship. These postulations yield our ‘Gender Congruent Legitimacy Judgment’ framework, an initial step towards an overarching theory of gender dynamics in new venture legitimacy. Moderation analyses based on propensity score-weighted data on startups’ pre-money valuation validate our theoretical conjectures.