Sky Blog
The allocation of control rights between entrepreneurs and capital providers plays a central role in financial contracting and corporate governance. Debt contracts typically include accounting-based covenants that transfer control rights to lenders when accounting numbers (such as earnings) fall below …
In a recent paper, we focus on the expected agency problems in equity crowdfunding markets and the governance mechanisms that might mitigate them.
In equity crowdfunding, there are two pronounced problems that result from significant information asymmetry associated with small …
Contracting parties in an on-going relationship often rely on informal norms to resolve disputes and reduce transaction costs. Known as “relational contracting,” this concept is typically studied in the context of procurement contracts between manufacturers and suppliers,[1] but it …
A few years ago, signs of change started to appear in the startup world. Media headlines began reporting battles between regulators and Uber and Airbnb. Sharing economy companies faced worker classification issues, and fintech companies bumped up against securities regulation, …
Bankruptcy law has evolved over the centuries as an orderly way to deal with dying firms. However, during the recent recession, many policy experts, officials, and legislators advocated sidestepping the bankruptcy process and resorting to so-called bailouts.
Bailouts have been …
It is well established that venture capitalists can improve the product market value — the quality of projects and employees — at the private firms they invest in, either by making the firms more efficient (Chemmanur, Krishnan, and Nandy (2011)) …
Following the referendum vote on June 23, 2016, the UK government proposed to notify the European Council by March 31, 2017 under article 50(2) of the Treaty on European Union of the UK’s decision to leave the EU.
The UK …
In the paper “Intrapreneurship,” recently made available on SSRN, I turn my focus from startups/entrepreneurship to innovation inside large corporations, or intrapreneurship. I examine both traditional intrapreneurship, or innovation taking place inside large corporations, and corporate venture capital, where …
Some legal rights and obligations are so venerated and longstanding that they have become virtual absolutes—categorical imperatives that trump other less urgent considerations. But what happens when two such absolutes collide? This was a question that the US District Court …