Achtung: hohPublica wurde am 18.11.2024 aktualisiert. Falls Sie auf Darstellungsfehler stoßen, löschen Sie bitte Ihren Browser-Cache (Strg + Umschalt + Entf). *** Attention: hohPublica was last updated on November 18, 2024. If you encounter display errors, please delete your browser cache (Ctrl + Shift + Del).

Browsing by Subject "Agency cost"

Type the first few letters and click on the Browse button
Now showing 1 - 1 of 1
  • Thumbnail Image
    Publication
    Moral hazard in VC finance : more expensive than you thought
    (2017) Tennert, Julius; Lambert, Marie; Burghof, Hans-Peter
    Venture projects are fraught with exogenous market risk and endogenous agency risk. We apply a real options perspective to analyze the investment decision of the venture capitalist (VC) in this set-up. The solutions presented are conflictive: the VC reduces his exposure to exogenous risk by delaying investments to wait for informational updates (delay option), but he mitigates endogenous risk by advancing investments to discover entrepreneur’s effort. So far, papers focus on the optimal timing of investments considering independence of exogenous and endogenous risk. We show that interdependence of exogenous risk and endogenous risk exists. We find that endogenous risk prompts the VC to accelerate the discovery process when exogenous risk is high, and to abandon the delay option when it is most valuable.