Do Venture Capital Investors Learn from Public Markets

  title={Do Venture Capital Investors Learn from Public Markets},
  author={Bibo Liu and X. Tian},
We examine the real effects of financial markets from the perspective of venture capital (VC) investors. We postulate that VCs actively learn information contained in public markets when designing investment structure in their startup ventures. We find that, when public market prices are more informative, VCs are less likely to stage finance startup ventures and to syndicate with other VCs to save the costs associated with staging and syndication. This effect is more pronounced when VCs are… Expand

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