The Role of Agents in Private Entrepreneurial Finance

Douglas J. Cumming*, J. Ari Pandes, Michael J. Robinson

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

5 Citations (Scopus)

Abstract

We examine theory and evidence on agents in private-market entrepreneurial financings. After controlling for the endogenous issuer-agent matching and a whole host of other controls, the empirical findings in this paper indicate that agents attract more investors, broaden the geographic investor and capital base, and increase the percentage of investors and capital from investors that are more vulnerable to the costs of information asymmetry. We also find that more capable agents generally provide more valuable benefits to private entrepreneurial firm financings than less capable agents, and that increasing the number of agents in a financing further increases value to issuing firms.

Original languageEnglish
Pages (from-to)345-374
Number of pages30
JournalEntrepreneurship: Theory and Practice
Volume39
Issue number2
DOIs
Publication statusPublished - 1 Mar 2015

Bibliographical note

Publisher Copyright:
© 2013 Baylor University.

ASJC Scopus subject areas

  • Business and International Management
  • Economics and Econometrics

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