What℉s in it for me? Reciprocal exchanges between underwriters and venture capitalists

Douglas R. Miller (Virginia Commonwealth University)
Tera L. Galloway (Illinois State University)
Dustin B. Smith (Webster University)

New England Journal of Entrepreneurship

ISSN: 2574-8904

Article publication date: 1 March 2015

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In this article, we examine the impact of repeat interactions between VCs and underwriters. Past research has suggested that such interactions build trust and may contribute to more equitable treatment of issuing firms. We adopt an alternative perspective and suggest that these repeat interactions are characterized by reciprocal exchanges facilitated by opportunistic behavior from the VC. Our analysis demonstrates that VCs and underwriters interact in order to appropriate greater value from the IPO. This article provides a more complete understanding of repeat interactions between the VC and the underwriter by identifying characteristics of the relationship that have an impact on the value of the IPO.



Miller, D.R., Galloway, T.L. and Smith, D.B. (2015), "What℉s in it for me? Reciprocal exchanges between underwriters and venture capitalists", New England Journal of Entrepreneurship, Vol. 18 No. 2, pp. 11-18. https://doi.org/10.1108/NEJE-18-02-2015-B001



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