The 'New' Venture Capital Cycle (Part I): The Importance of Private Secondary Market Liquidity

2011 ◽  
Author(s):  
Jose Miguel Mendoza ◽  
Erik P. M. Vermeulen
Keyword(s):  
Venture Capital ◽  
Secondary Market ◽  
Market Liquidity ◽  
New Venture

A Comparative Analysis of Drivers of Secondary Market Liquidity in Financial Markets for Investment Analysis

2019 ◽  
pp. 340-366
Author(s):  
Hakki Karatas ◽  
Nildag Basak Ceylan ◽  
Ayhan Kapusuzoglu
Keyword(s):  
Comparative Analysis ◽  
Stock Markets ◽  
Global Financial Crisis ◽  
Negative Impact ◽  
Bond Market ◽  
Secondary Market ◽  
Market Liquidity ◽  
Investment Analysis ◽  
Secondary Bond ◽  
The Impact

The purpose of this chapter is to examine the drivers of secondary bond market and stock market liquidity for investment analysis after global financial crisis in Turkey. The literature in Turkey mainly focuses only on the volatility of return for driving liquidity in both bond and stock markets. However, it is argued that other types of volatilities including domestic and international volatilities have also a deteriorating impact on secondary market liquidity in Turkey. In this context, it is empirically tested whether the volatility and/or uncertainty that stem from the FED and ECB policies within the last 10 years had a negative impact on liquidity both in government bond and stock markets. Moreover, the impact of non-residents in bond and stock markets on secondary market liquidity is examined by including their holdings in stock and bond market.

OTC Stock Market in China – The New Venture Capital Exit?

2015 ◽  
Vol 6 (2) ◽  
Author(s):  
Jing Li
Keyword(s):  
Stock Market ◽  
Venture Capital ◽  
Active Role ◽  
New Venture ◽  
Stock Exchanges ◽  
Market Making ◽  
Secondary Markets ◽  
Listed Firms

AbstractVenture capital is certainly important to a country in that it finances entrepreneurship and innovation. In recent years, secondary markets for private shares have emerged as an important node in the VC cycle by both facilitating interim liquidity for non-listed firms and providing external investors with the access to good pre-IPO shares. Ready and able to play an active role on both the exit and entry sides, are VCs more engaged in reducing or increasing their ownership in these markets? Based on a sample consisting of a total of 102 firms that have been quoted on China’s New Third Board from 2006 to 2011 year end, this paper finds that VCs were much more likely to increase than decrease their ownership – there have been 128 times of increases in contrast to 45 times of decreases. In particular, VCs actively took the opportunities of subscribing new shares issued in capital increases to increase their ownership. Out of the total 85 VCs that invested in the 102 firms, 33 were already there as of first quotation, 39 VCs subscribed new shares in capital increases, 33 VCs bought shares from existing shareholders, while only 11 exited. For the purposes of enhancing the attractiveness of the New Third Board as an exit venue, this paper argues that the market should work on increasing its liquidity from both the supply and the demand sides. As the successor of the New Third Board, the National Equities Exchange and Quotations largely manages to realize this by considerably broadening the pool of potential eligible firms and investors, and also by making available various additional mechanisms such as market making and call auctions to boost share transfers. As such, it is generally reasonable to argue that for those SMEs that are not yet able to directly list on public stock exchanges but are already in need for interim liquidity, the NEEQ does serve as a useful platform to achieve the purpose, and thus fills a gap in China’s VC cycle.

scholarly journals Secondary Market Liquidity and Primary Market Pricing of Corporate Bonds

2019 ◽  
Vol 12 (2) ◽  
pp. 86 ◽  
Author(s):  
Michael A. Goldstein ◽  
Edith S. Hotchkiss ◽  
David J. Pedersen
Keyword(s):  
Asset Prices ◽  
Cost Of Capital ◽  
Secondary Market ◽  
Market Liquidity ◽  
Corporate Bond ◽  
Yield Spread ◽  
Market Pricing ◽  
Yield Spreads ◽  
Ex Ante ◽  
The Impact

This paper studies the link between secondary market liquidity for a corporate bond and the bond’s yield spread at issuance. Using ex-ante measures of expected liquidity at the time of issuance, based on the characteristics of the underwriting syndicate, we find an economically large impact of liquidity on yield spreads. We estimate that a 10% increase in expected liquidity implies a decrease in the yield spread at issuance of between 8% and 14%. Our results suggest that liquidity has an important effect on firms’ cost of capital, and they contribute to the literature which examines the impact of liquidity on asset prices.

Venturing into retail: SoGal and cherry blossom intimates

2021 ◽  
pp. 1-11
Author(s):  
Supriya Munshaw ◽  
Christina Black
Keyword(s):  
Venture Capital ◽  
Learning Outcomes ◽  
Subject Area ◽  
Minority Women ◽  
New Venture ◽  
Venture Capital Firm ◽  
Retail Business ◽  
New Business ◽  
Cherry Blossom ◽  
Minority Entrepreneurs

Study level/applicability Graduate or Undergraduate Entrepreneurship Majors Subject area Entrepreneurship/Venture Capital (VC) Investing Case overview The case highlights a women-founded venture capital firm that values investments in diverse entrepreneurs and an innovative retail business started by two minority entrepreneurs. Students will be asked whether the firm should invest in the venture and will also be asked to discuss models that may help transform the retail business into a VC-backed scalable technology business. Expected learning outcomes By the end of the discussion, students will be able to evaluate the feasibility and scalability of a new business venture; and evaluate the alignment between a venture capital company and a new venture. Supplementary Materials Teaching Notes are available for educators only. Please contact your library to gain login details or email [email protected] to request teaching notes. Social Implications This case highlights the lack of resources for women and minority entrepreneurs as well as the underrepresentation of minority women in the VC industry. Subject code CSS 3: Entrepreneurship

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