Title: Incumbent strategic behavior in financial markets and the exit of entrepreneurial start-ups
Authors: Huyghebaert, Nancy ×
Van de Gucht, Linda #
Issue Date: Jul-2004
Series Title: Strategic Management Journal vol:25 issue:7 pages:669-688
Abstract: This paper empirically investigates the forces that shape the post-entry, exit probability of entrepreneurial start-ups, with an emphasis on the impact of incumbents' strategic behavior in financial markets. We find that entrepreneurial start-ups in highly competitive industries are more likely to exit and that leverage compounds this exit risk. However, the latter result only holds when potential adverse selection and moral hazard problems in financial markets are large at start-up. Under these circumstances, competitors can negatively influence creditors' perceptions on entrepreneurial quality or behavior through aggressive strategic actions to impede future financing and induce the start-up's exit. Copyright (C) 2004 John Wiley Sons, Ltd.
ISSN: 0143-2095
Publication status: published
KU Leuven publication type: IT
Appears in Collections:Research Center Finance, Leuven
× corresponding author
# (joint) last author

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