Shareholding By Venture Capitalists And R&D Investment In The Pre-And Post-IPO Periods
In this paper, the authors will analyze the effect of IPOs on R&D investment and argue a change in the role of VC in the pre- and post-IPO periods for Japanese firms. It can be stated that the shareholding by VC mitigates the financial constraints of firms and is positively correlated with their R&D investment in the pre-IPO period; however, this effect disappears in the post-IPO period. In addition, it can be assumed that financial constraints are released and informational asymmetries are reduced by IPOs. Thus, R&D investment is influenced by IPOs.