Venture capital and corporate governance in the newly public firm

Yael V. Hochberg*

*Corresponding author for this work

Research output: Contribution to journalReview articlepeer-review

92 Scopus citations


I examine the effects of venture capital backing on the corporate governance of the entrepreneurial firm at the time of transition from private to public ownership. Using a selection model framework that instruments for venture backing with variations in the supply of venture capital, I conduct three sets of tests comparing corporate governance in venture- and non-venture-backed initial public offering (IPO) firms. Venture-backed firms have lower levels of earnings management, more positive reactions to the adoption of shareholder rights agreements, and more independent board structures than similar non-venture-backed firms, consistent with better governance. These effects are not common to all pre-IPO large shareholders.

Original languageEnglish (US)
Pages (from-to)429-480
Number of pages52
JournalReview of Finance
Issue number2
StatePublished - Apr 2012

ASJC Scopus subject areas

  • Accounting
  • Finance
  • Economics and Econometrics


Dive into the research topics of 'Venture capital and corporate governance in the newly public firm'. Together they form a unique fingerprint.

Cite this