-
Journal menu
- General information
- Editorial Board and External Reviewers
- Journal Policies
- Publication Ethics and Malpractice Statement
- Instructions for authors
- Paper reviewing
- Article processing charge
- Feedback from stakeholders
- Journal’s Open Access statement
- Order hard copies of the journal
- 50 most cited papers in the journal
EXIT MARKET LIQUIDITY AND VENTURE CAPITALISTS’ INVESTMENT BEHAVIOUR: EVIDENCE FROM AUSTRALIA, CANADA AND THE UNITED KINGDOM
Download This Article
Shrimal Perera 
, Tabita Bertsch, Jayasinghe Wickramanayake
Abstract
This study investigates the effect of exit market liquidity on venture capitalists’ (VCs’) investment behaviour. The sample consists of 4,758 investment rounds disbursed by venture capital funds in three selected common law-based OECD countries (Australia, Canada and the United Kingdom) during 1990-2005. The results indicate that investments in early-stage projects by VCs are not related to exit market liquidity conditions after controlling for exogenous factors. Empirical results, however, show that exit market liquidity is positively associated with VCs’ investments in new projects (as opposed to follow-on projects). Put differently, new firms (including start-ups) are more likely to obtain venture capital funding during times of liquid exit market conditions. Arguably, these findings highlight the importance of ‘timing’ of new project launch.
Keywords: Venture Capital Finance, Liquidity Risk, Exit Market Liquidity
How to cite this paper: Perera, S., Bertsch, T., & Wickremanayake, J. (2010). Exit market liquidity and venture capitalists’ investment behaviour: Evidence from Australia, Canada and the United Kingdom. Corporate Ownership & Control, 8(1-8), 743-757. https://doi.org/10.22495/cocv8i1c8p1
