Equity crowdfunding, market timing, and firm capital structure

In a new paper, forthcoming in a special issue on equity crowdfunding in The Journal of Technology Transfer, we examine the impact of market timing on the capital structure of private firms that raise initial equity crowdfunding (ECF). Our sample includes firms financed via either Crowdcube or Seedrs, the two largest UK ECF platforms. We find that in hot markets, ECF firms set higher targets, collect more overfunding, and thus raise more equity capital than ECF firms in cold markets. Surprisingly, however, and inconsistent with a market timing theory of capital structure, we fail to find differences between the leverage ratios of hot- and cold-market firms from the year of the ECF campaign. This finding is explained by hot-market ECF firms contemporaneously rebalancing their capital structure by attracting more debt, especially financial debt.

Cerpentier, M., Vanacker, T., Paeleman, I. and Bringmann K. (2021) Equity crowdfunding, market timing, and firm capital structure. The Journal of Technology Transfer.
The article is available as ‘Online First’, please see:

FPIM Chair Anniversary Symposium: A Candid View of Women in Entrepreneurship

The Federal Holding and Investment Company (SFPI-FPIM) and the Royal Flemish Academy of Belgium for Science and the Arts (KVAB) kindly invite you to a symposium on gender, entrepreneurship and financing. Despite promising trends, women are still heavily underrepresented in the high-tech startup scene. Gender disparities persist, with women-led companies continuing to account for a small portion of deal flow and overall invested capital. Even more, the COVID-19 pandemic likely had a disproportionate impact on women’s economic situation. This makes gender smart investing and increasing female participation in innovative entrepreneurship a policy priority at the local, national and global level.

June 10th, 2021, 15h30 – 17h30. Online.

Speakers: Alexander De Croo (Prime minister), Hilde Crevits (minister), Sophie Manigart (Vlerick Business School)& Ghent University , Katja Bringmann (Ghent University), among others

More info & registration: FPIM Chair Anniversary Symposium: A Candid View of Women in Entrepreneurship | KVAB

Acquisitions: a curse or blessing for direct competitors? The impact of target ownership structure

This study examines the impact of horizontal acquisition announcements on the value of direct competitors of the combined entity. We argue that the ownership structure of the target drives competitor wealth effects. First, the stronger disciplining force of the market for corporate control for public firms compared to private firms will lead to higher competitive pressure post-acquisition when a public firm is acquired, leading to more negative valuation effects of direct competitors. Second, acquisitions of subsidiary targets, compared to stand-alone targets, are expected to lead to stronger asset utilization improvements in the target, leading to more negative competitor returns. A unique hand-collected sample of 1,038 direct competitors of 228 horizontal acquisitions in Europe empirically supports these hypotheses. Alternative explanations, such as information asymmetry or empire-building, are rejected.

Virginie Mataigne, Sophie Manigart, Mathieu Luypaert. Acquisitions: a curse or blessing for direct competitors? The impact of target ownership structure
Journal of Corporate Finance, forthcoming

Vacancy for a Ph.D. student

See PhD Student — Ghent University (ugent.be) for the full job description and details on how to apply for this vacancy.

  • Fundamental and applied research will be performed at Ghent University under the supervision of prof. Joke Baeck (Faculty of Law and Criminology), prof. Klaas Mulier (Faculty of Economics and Business Administration), and prof. Thomas Demeester (Faculty of Engineering and Architecture).
  • The proposed research fits within the FWO-funded research project “Evaluation of distressed enterprises using explainable machine learning: construction of an artificial intelligence algorithm to assist judges in Belgian Enterprise Courts”.
  • The activities of the PhD are embedded in a stimulating interdisciplinary environment, with the focus on contributions in explainable AI and corporate bankruptcy prediction, within the setting of law.
  • The PhD candidate will thus work on the intersection between Data Science, Corporate Finance and Bankruptcy Law. Depending on the candidate’s preference, emphasis can be placed either on the economic aspect (within the Corporate Finance research group), or on the computer science part (within the Internet and Data Science research group).


  • In close collaboration with the supervisors as well as a post-doctoral researcher with expertise in both computer science and law, the Ph.D. candidate will apply machine learning techniques and tools to mine and leverage economic enterprise data (such as balance sheets and profit & loss accounts) for predicting corporate distress and potential bankruptcy to assist judges.
  • Numerical data as well as free-text notes will be injected into the models, which will require a considerable level of transparency and explainability in order to be valuable in practice.
  • Model evaluations will be performed iteratively in collaboration with Enterprise Court judges in Flanders and/or on a wider geographic scale.
  • The candidate will also contribute to developing proof-of-concept tools and rolling out field tests at Belgian Enterprise Courts.
  • The candidate will present research results at major international conferences and publish in international peer reviewed journals, as part of meeting the requirements for the PhD.

The real effects of banks’ corporate credit supply: a literature review

In this paper, we review the rapidly growing literature on the real effects of banks’ corporate credit supply. We cover recent methodological advances and provide an in-depth survey of the existing evidence. The literature consistently shows that credit supply contractions lead to adverse real outcomes, but economic magnitudes vary across samples and identification strategies. This variation has become smaller in more recent work, using highly granular data. We further document heterogeneity in firm outcomes and show that the evidence is more ambiguous for expansionary shocks. Our analysis allows us to identify current knowledge gaps and worthwhile avenues for future research.

The real effects of banks’ corporate credit supply: a literature review
K. Mulier, O. Güler, M. Mariathasan, N. Okatan, Economic Inquiry (forthcoming)

(with Ozan Guler, Mike Mariathasan, and Nejat Okatan)

The sandwich game: Founder-CEOs and forecasting as impression management

We examine the use of positively biased forecasts by (non-)founder-CEOs as an impression management tactic vis-à-vis their existing investors. We hypothesize that founder-CEOs will strategically provide less positively biased forecasts to their investors than non-founder-CEOs. Using two independent samples with revenue forecasts reported to different venture capital investors and a causal chain scenario study consisting of two experiments, we find consistent support for our hypothesis. Our paper adds nuance to the dominant perspective on forecasting errors by theorizing and showing that inflated forecasts are not solely the result of cognitive bias but can be a deliberate, discretionary form of IM that takes into account the CEO’s trade-off between the social/financial costs versus benefits of providing more positive forecasts to investors.

Collewaert, V., Vanacker, T., Anseel, F., & Bourgois, D. (2021). The sandwich game: Founder-CEOs and forecasting as impression management. Journal of Business Venturing. https://doi.org/10.1016/j.jbusvent.2020.106075

Ban, Boom, and Echo! Entrepreneurship and Initial Coin Offerings

Drawing on institutional theory, we investigate the entrepreneurship implications of regulatory spillover. Regulatory spillover occurs when regulations in one country affect either the expected regulatory approach in another country and/or the entrepreneurial actions in another country. In the context of Initial Coin Offerings (ICOs), we theorize that a regulatory ban in countries (i.e., China, South Korea) causes a short-term increase in the number of low-quality ICOs in other countries and a long-term drop in the number of ICOs albeit with a higher average quality. We introduce new large sample quarterly data on ICOs from 108 countries and show results consistent with our theory.

Bellavitis, C., Cumming, D. J., & Vanacker, T. (Forthcoming). Ban, Boom, and Echo! Entrepreneurship and Initial Coin Offerings. Entrepreneurship Theory and Practice.

Corporate entrepreneurship, country institutions and firm financial performance

Although previous research shows that corporate entrepreneurship (CE) relates to firm performance differently across countries, there is little research on the country-level factors that explain these differences. Adopting an institutional perspective, we propose that home country intellectual property (IP) and employee protection institutions moderate the relationship between corporate entrepreneurship (CE) and firm performance. Examining 9642 European firms, we find that whereas internal CE is more positively correlated with firm performance in countries with less stringent IP protection and less stringent employee protection, external CE (venturing) is particularly negatively correlated with firm performance in countries with less stringent IP protection and more stringent employee protection.

Vanacker, T., Zahra, S. A., & Holmes, R. M. (Forthcoming). Corporate entrepreneurship, country institutions and firm financial performance. Journal of World Business.

Venture Capital, Credit, and FinTech Start-Up Formation: A Cross-Country Study

Why is a greater availability of venture capital (VC) and credit more (or less) effective in different countries for increasing start-up formations in new entrepreneurial industries, such as FinTech? In a new paper, forthcoming in Entrepreneurship Theory and Practice, we argue and show that with their established and globally diffused norms and practices, VC investors—but not banks—require a critical mass of FinTech entrepreneurship in a country to more positively influence FinTech entrepreneurship. Moreover, VC and credit markets are substitutes, especially in countries with more FinTech entrepreneurship. Our arguments and evidence show considerable consistency with the National Innovation Systems (NIS) framework.

Kolokas, D., Vanacker, T., Veredas, D., & Zahra, S. A. (Forthcoming). “Venture Capital, Credit, and FinTech Start-Up Formation: A Cross-Country Study.” Entrepreneurship Theory and Practice.

A gender financing gap: fake news or evidence?

Women-led businesses are less likely to raise venture capital than male-only businesses and the amounts that they raise are lower. Yet women-led businesses deliver better revenue performance and return on investment. So why are venture capitalists reluctant to invest in women-led businesses? One reason is that women entrepreneurs are over concentrated in sectors that are less attractive to investors and have a low presence in technology sectors. Another reason is the lower propensity of women entrepreneurs to seek venture capital. However, women who do approach venture capital funds are almost as likely as men to be successful in raising finance. Moreover, women-led businesses perform well in raising follow-on finance. And women business angels – a minority of all business angels – have a clear propensity to invest in women founders.

Rudy Aernoudt, Ampara De San José. Venture Capital, published online 31 March 2020.