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This paper investigates the effects of going public on innovation by comparing the innovation activity of firms that go public with firms that withdraw their initial public offering (IPO) filing and remain private. NASDAQ fluctuations during the bookbuilding phase are used as an instrument for IPO completion. Using patent-based metrics, I find that the quality of internal innovation declines following the IPO, and firms experience both an exodus of skilled inventors and a decline in the productivity of the remaining inventors. However, public firms attract new human capital and acquire external innovation. The analysis reveals that going public changes firms' strategies in pursuing innovation.

We analyze how corporate venture capital (CVC) differs from independent venture capital (IVC) in nurturing innovation in entrepreneurial firms. We find that CVC-backed firms are more innovative, as measured by their patenting outcome, although they are younger, riskier, and less profitable than IVC-backed firms. Our baseline results continue to hold in a propensity score matching analysis of IPO firms and a difference-in-differences analysis of the universe of VC-backed entrepreneurial firms. We present evidence consistent with two possible underlying mechanisms: CVC's greater industry knowledge due to the technological fit between their parent firms and entrepreneurial firms and CVC's greater tolerance for failure.

Based on a sample of venture capital (VC)-backed IPO firms, we examine whether tolerance for failure spurs corporate innovation. We develop a novel measure of VC investors' failure tolerance by examining their willingness to continue investing in underperforming ventures. We find that IPO firms backed by more failure-tolerant VC investors are significantly more innovative and VC failure tolerance is particularly important for ventures that are subject to high failure risk. We show that these results are not driven by endogenous matching between failure-tolerant VC firms and start-ups with high ex ante innovative potential. We also examine the determinants of the cross-sectional heterogeneity in a VC firm's failure tolerance. We find that both capital constraints and career concerns can negatively distort a VC firm's failure tolerance. Less experienced VC firms are more exposed to these distortions, making them less failure tolerant than are more established VC firms.

Literature on how cities get connected through networks of firms has been increasing in recent years. In particular, advanced producer service (APS) firms are being widely used to build intrafirm linkages to establish urban networks. In contrast to studies applying intra-firm networks, this study proposes an alternative strategy to build urban networks based on inter-firm service provision relationships during the process of initial public offering (IPO) in which APS firms – including securities, law firms and accounting firms – provide professional services for firms aiming to be publicly listed. Based on service provision connections between APS firms and their clients, this study provides fresh insights on urban networks in China. The results show that Beijing, Shenzhen and Shanghai strategically hold dominant positions within Chinese urban networks and they are the lead command and financial centres within the country. Particularly, Beijing has overwhelmingly more influence over other cities. The urban networks are embedded in China’s unique institutional context where market and state power together have shaped these networks. Since the urban network is built up based on real economic linkages, the findings might have further implications for policy-making and could contribute to ongoing debates regarding financial centres in China. It implies that connections between firms based on real economic activities can be an effective way to construct urban networks in future research. 近年来，关于城市如何通过企业网络联系的文献一直在增加。特别是，研宄者广泛运用高级生 产者服务（APS)企业来建立企业内部联系，从而构建城市网络。与运用企业内部网络的研宄不 同，本研宄提出了构建城市网络的另一种策略，该策略基于首次公开募股（IPO)过程中企业间 的服务提供关系，其中APS企业（包括证券公司、律师事务所和会计事务所）为旨在公开上市 的公司提供专业服务。基于APS企业与客户之间的服务提供关系，本研宄带来了关于中国城市 网络的新见解。结果显示，北京、深圳和上海在中国城市网络中占据主导地位，是全国的指挥 中心和金融中心。特别是北京对其他城市的影响力更大。城市网络嵌入在中国独特的制度环境 中，市场和国家权力一起塑造了这些网络。由于城市网络是在实际经济联系的基础之上建立起 来的，所以调査结果可能对决策有进一步的隐含意义，并可能对关于中国金融中心的持续辩论 作出贡献。这意味着企业之间基于实际经济活动的联系可能是今后研宄中构建城市网络的有效 途径。

As Initial Public Offering (IPO) is a significant milestone in the financial strategy of a firm, this study aims to evaluate performance of IPOs using multiple measures including account­ing-based performance (ABP), value-based performance (VBP) and overall performance (OP) in the pre-and post-IPO periods. Therefore, we present two combined approaches based on a compromise MCDM method-VIKOR and objective weighting methods-CRITIC and MW (Mean Weight) to evaluate and rank IPOs to help shareholders with understanding on how their performance changes under the different measures. Since the compromise solution (one or a set) proposed by VIKOR depends substantially on criteria weights, VIKOR-CRITIC can show more realistic results because of the differential weights assigned to criteria by CRITIC. In this study, a case study is con­ducted in order to evaluate the performance of Turkish IPOs based on ABP, VBP and OP measures using the combined methods. The results show that the compromise solution results obtained by VIKOR-CRITIC may be a guideline for investors in making more profitable investment decisions before leaping into any investment decision. First published online: 27 Mar 2017

Socioemotional wealth (SEW), i.e., the noneconomic utility a family derives from its ownership position in a firm, is the primary reference point for family firms. Family firms are willing to sacrifice economic gains in order to preserve their noneconomic utility. Thus, we argue that family firms sacrifice IPO proceeds by choosing higher IPO underpricing than nonfamily firms if underpricing helps them protect their SEW. Our empirical results, based on a sample of 153 German IPOs, support our hypothesis. On average, family firms have 10 percentage points more IPO underpricing than nonfamily firms.

Chinese listed companies have a two-tier (dual) governance structure that comprises a supervisory board/-committee (SB) and the board of directors (BoD). However, as there is no hierarchical relationship between them, the two boards are independent. This is different from the governance mechanism in Continental Europe in which the SB appoints the directors of the management board; in this sense, the Chinese two-tier governance structure is unique. We investigate the impact of governance characteristics and ownership structure on gender diversity of both the BoD and the SB for a sample of 892 Chinese Initial Public Offerings floated in both the Shanghai and Shenzhen Stock Exchanges. We find that the average proportion of female directors and female SB members on the BoD and the SB are 10 and 22 %, respectively. Using both static and dynamic panel data methods, we find that there is no significant impact of board structure on gender diversity in China. However, we find a positive and significant relationship between SB size and gender diversity. We also find that the higher the state ownership, the lower the female representation on both boards. Finally, our findings show that there is a bi-directional relationship between financial performance and the proportion of female directors sitting on the BoD.

We find that the majority of variation in leverage ratios is driven by an unobserved time-invariant effect that generates surprisingly stable capital structures: High (low) levered firms tend to remain as such for over two decades. This feature of leverage is largely unexplained by previously identified determinants, is robust to firm exit, and is present prior to the IPO, suggesting that variation in capital structures is primarily determined by factors that remain stable for long periods of time. We then show that these results have important implications for empirical analysis attempting to understand capital structure heterogeneity.

We analyze the value of investor relations (IR) strategies to IPO firms. We find that firms that are less visible and have inexperienced management tend to hire IR consultants prior to the issue date. IR consultants help create positive news coverage before an IPO, as reflected in a more optimistic tone of published media. Their presence is associated with higher underpricing at the IPO date but with lower long-run returns. IR-backed IPOs also exhibit disproportionately higher insider-related agency problems, as IR-induced higher underpricing tends to occur primarily in IPOs where underwriter and venture capitalist agency conflicts are more severe. These findings suggest that the IR programs of IPO firm are mostly short-term oriented and facilitate the ulterior motives of some insiders (underwriters and venture capitalists) targeting higher first-day returns.

This paper contributes to the corporate governance literature by developing and testing theory regarding positive and negative synergies between the CEO's and the board's human and social capital. Using a sample of 360 biotechnology firms that went public between 1995 and 2010, we demonstrate that accumulated public company board experiences of the CEO and the board have positive synergistic effects on IPO performance whereas the current board appointments have negative effects. While scientific educational backgrounds have positive synergies, industryspecific experiences produce either positive or counterproductive effects depending on the age and profitability of the firm. Thus, our paper contributes to the corporate governance and human and social capital literatures by describing the costs and benefits of specific types and combinations of CEO and board capital.