Combining agency theory and the resource-dependence perspective as well as signalling
theory, this thesis examines the role venture capitalists (VCs) and founders play with
respect to both structural board characteristics and board capital in terms of experience and
prestige and whether these are linked to performance.
It claims that VCs and founders shape the governance system of the firms going public and
are influential in the professionalisation of the ventures especially in terms of human and
social capital of its board of directors. It also argues that the board of directors represents a
signal of firm quality in the initial public offering (IPO) market and should thus be linked
to performance. Similarly, according to the venture capital certification hypothesis, being
funded by VCs signals a firm¿s quality and potential.
In order to assess these claims, this thesis employs a unique sample of matched venturecapital-
backed and non-venture-capital-backed entrepreneurial IPOs that floated either on
the London Stock Exchange¿s Official List or the Alternative Investment Market (AIM).
Extending previous research this thesis employs more fine-grained measures and introduces
new conceptually relevant variables in the analysis.
The findings indicate that VCs and founders are influential in shaping corporate governance
of IPO-stage ventures both from an agency and resource-provision perspective. Findings
from the examination of governance and professionalisation characteristics with respect to
IPO short-run performance (underpricing) indicate that it may the involvement of
prestigious auditors that signal firm quality while a founder bias discount seems to exist.
While evidence is found that VC involvement (and to a lesser extent director/board
characteristics) is related to post-IPO market performance, this seems to depend on the time
period following the IPO examined, whereas auditor prestige shows a positive association
in all of these time periods. / Bradford University School of Management
| Identifer | oai:union.ndltd.org:BRADFORD/oai:bradscholars.brad.ac.uk:10454/4458 |
| Date | January 2010 |
| Creators | Thiess, Rolf C. |
| Contributors | Filatotchev, Igor, Ward, Damian |
| Publisher | University of Bradford, School of Management |
| Source Sets | Bradford Scholars |
| Language | English |
| Detected Language | English |
| Type | Thesis, doctoral, PhD |
| Rights | <a rel="license" href="http://creativecommons.org/licenses/by-nc-nd/3.0/"><img alt="Creative Commons License" style="border-width:0" src="http://i.creativecommons.org/l/by-nc-nd/3.0/88x31.png" /></a><br />The University of Bradford theses are licenced under a <a rel="license" href="http://creativecommons.org/licenses/by-nc-nd/3.0/">Creative Commons Licence</a>. |
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