Differentiating between successful VC exit strategies: The influences of time-since-first-funding-received by the venture and strength of US VCs in cross-border syndicates

Kanhaiya K. Sinha, Sanjay Goel, Nga Nguyen

Research output: Contribution to journalArticlepeer-review

Abstract

In this study, we argue that successful exit outcomes (Trade Sales (TS) or IPO) from VCs' cross-border investments are influenced by time-since-first-funding-received (TSFFR) by the venture. As TSFFR increases, the venture reveals more information about its potential, influencing the value that trade and IPO buyers place on it. This, in turn, influences whether VCs exit via a TS or an IPO. Analyzing 1841 cross-border of UC fund-venture pairs, our findings suggest that TSFFR has an inverted-U-shaped association with the probability of TS. The strength of the US VCs in the cross-border syndicate interacts with this association, reducing the probability of TS exit for lower levels of TSFFR and increasing it for higher levels.

Original languageEnglish (US)
Article number103758
JournalInternational Review of Financial Analysis
Volume96
DOIs
StatePublished - Nov 2024
Externally publishedYes

Bibliographical note

Publisher Copyright:
© 2024

Keywords

  • Cross-border
  • IPO
  • Time-since-first-funding-received
  • Trade sales
  • VC funds
  • VC syndicates

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