Abstract

This study investigates the long-term performance of pre-initial public offering (IPO) high growth firms. Despite the extensive knowledge on drivers of high growth, we know little about the market outcomes and boundaries of such strategy. Our findings suggest a negative relationship between pre-IPO high growth and long-term performance. We also find that while growth-orientation and scalability reduce the negative reaction of investors to pre-IPO high growth, profitability-orientation and intensity of acquisition intensify their negative reactions. We use a sample of US IPOs during 2002-2015 to empirically test our hypotheses.

Full Text
Published version (Free)

Talk to us

Join us for a 30 min session where you can share your feedback and ask us any queries you have

Schedule a call