Capital Funds Research Articles

Investing in niche marketplaces: value for leading companies

The role of strategic investors in the evolution of niche marketplaces, particularly in Ukraine, has been analyzed in the research. Automation and digitalization have become the key factors for efficiency in modern business. An important element of this process is a marketplace. They force traditional markets to adapt to new conditions. It is hypothesized that strategic investments in niche marketplaces contribute to long-term market development, leading to sustainable economic growth. The research was carried out through the analysis of literary sources, comparative analysis and the case study method. The fact that venture capital funds usually invest in marketplaces targeting high future returns was shown as a result of our investigation. However, strategic investors have a different approach. They direct their investments not only towards making a profit but also towards market development, creating long-term value, implementing innovations, advancing industry growth, building communication channels with customers, and obtaining valuable data for a better understanding of customer needs and market trends, as well as attracting organic traffic to meet specific market demands. Niche platforms among all variations of marketplaces deserve special attention, as they often represent unique opportunities. Such companies as EpicentrK.ua and Cropwise Operations are among examples of strategic investments in these marketplaces. They demonstrate how technological solutions can boost efficiency and productivity, ultimately leading to sustainable economic growth and development. These examples demonstrate that strategic investors prioritize developing market structures and creating high value for consumers

Carbon Footprint, Financial Structure, and Firm Valuation: An Empirical Investigation

This study aims to investigate the complex link between carbon emissions, firm value, and financial choice in regard to the GCC, a dynamic emerging economy. It also seeks to answer the question on whether the financial structure of a firm moderates the correlation between carbon emissions and firm value. We focus on analyzing data from non-financial firms registered on the GCC stock markets between 2010 and 2020. By applying the GLS technique, we assess the impact of carbon emissions on firm value and examine the manner in which a firm’s financial structure either enhances or hinders this relationship. The results demonstrate that there is a strong and adverse connection between carbon emissions and corporate value, as increased emissions translate into lower corporate value. The study then moves on to emphasize the critical role that capital financing plays in mitigating the detrimental effects of carbon emissions. This is accomplished by balancing both debt and equity in terms of their proper proportions (optimal capital structure). However, excessive borrowing could have adverse consequences in terms of carbon emissions on company value. Moreover, the GMM estimator is also applied to carry out a robustness check and the results are consistent with the main findings. This study highlights the significance of financial strategy in advancing sustainability and protecting business value. These findings are supported by both stakeholder and signaling theory, proving that companies can use their capital financing to signal their dedication to sustainability. These results could be used by GCC policymakers to create rules and regulations that encourage environmentally friendly corporate activities and efforts to lower emissions. The research expands the existing literature by examining the difficulties and opportunities faced by GCC firms when combining financial strategy with environmental objectives. It may be necessary to perform additional research in regard to various circumstances and for an extended period, because this study is restricted to non-financial sectors.

Private Equity Fund Reporting Quality, External Monitors, and Third-Party Service Providers

ABSTRACT We describe variation in the reporting quality (i.e., accuracy and bias of reported net asset values (NAVs)) of private equity (PE) funds across types of external monitors (investors and auditors) and third-party service providers (valuation specialists, marketers, and administrators). In contrast to public markets, we find only limited evidence that reporting quality varies with the composition and types of investors in PE funds. We observe, however, that reporting quality varies with auditor involvement and the use of third-party service providers; these associations often differ across buyout (BO) and venture capital (VC) funds and from those observed in public markets. Our evidence is important to investors and regulators, especially now that PE supersedes public markets as the main vehicle to raise capital and as regulators increase their focus on private markets. Data Availability: Data used in this study are available from public sources listed in the paper. JEL Classifications: G1; G14; G30; M4; M41.

Stakeholder perceptions of mangrove ecosystem services across scales of conservation focus.

Conservation faces a chronic shortage of resources, including time, funding, mental capacity, and human capital. Efforts to make the expenditure of these resources more efficient should, therefore, support more equitable and effective conservation prioritization. To achieve this, it is necessary to ensure the integration of the knowledge and perceptions of local stakeholders into larger scale conservation decisions. We used fuzzy cognitive mental modeling to assess the perceptions of mangroves and the prioritization of ecosystem services across 3 groups of stakeholders: representatives from 3 coastal Fijian villages, the national office of an international nongovernmental organization (NGO), and the US office of that same NGO. We found different topologies and valuations among the resultant mental models, with the US NGO office having the most terms. However, when comparing models from local villages with the US NGO office, scale-dependent perceptions shifted, including the relative devaluation of locally important cultural valuations of mangroves. Despite these variations in perceptions, however, 3 key components of the mental models-women's livelihoods, men's livelihoods, and fisheries supplementation-all appeared as consistently important in multiple models, suggesting areas around which potential collaboration among stakeholders could be forged. By focusing on system-wide, rather than stakeholder-specific, optimal solutions within the system, new opportunities for collaboration may emerge. In doing so, these system-wide solutions may increase efficiency and collaboration. Moreover, we found that boundary-spanning organizations, such as the national-level conservation organizations, played a role in facilitating information transfer and mediating conservation goals in a culturally appropriate fashion. Finally, although the specific example used here is mangrove conservation, our methodologies and findings are broadly applicable across a variety of conservation scenarios.

Waste-to-energy: exploring the roadmap for energy generation from commercial waste in South Africa

Purpose This study aims to investigate the adoption of waste-to-energy (WtE) technologies in South Africa (SA), focusing on identifying the key drivers, barriers and potential solutions for commercial uptake. The ultimate aim is to propose an implementation framework that promotes renewable energy while reducing landfill reliance. Design/methodology/approach A systematic literature review (SLR) of papers published between 2020 and 2023 was conducted to identify factors impacting WtE adoption in SA. The conceptual model developed from the SLR was tested using a qualitative case study approach. Data was collected through 15 semi-structured interviews with commercial entities and WtE experts from four regions of SA. Findings Anaerobic digestion and pyrolysis are identified as the most suitable waste-to-energy technologies in the South African context. Among the financial challenges of WtE in SA, the availability of cheap coal, low landfill tariffs, high capital costs, funding constraints and regressive economic incentives are critical. The lack of government support, insufficient incentives, regulatory burdens, weak policies and limited innovation capacity are considerable non-financial barriers hindering WtE technologies’ growth. The successful adoption of renewable energy also requires adequate infrastructure, increased sustainability awareness and technical expertise. Research limitations/implications Although the sample size is diverse and consists of a range of organisations, it may not capture the thoughts and experiences of other SA businesses in their entirety. It is important to note that the lack of existing research on the implementation, benefits and impacts of WtE technologies limits the authors’ ability to interpret and benchmark the findings of this study. Yet, this study contributes by developing an implementation framework to encourage WtE adoption, recommending policy actions such as regressive taxation on fossil fuels and landfills and promoting renewable energy through subsidies, awareness and energy credits. Practical implications This study provides a practical framework for businesses and policymakers to adopt WtE technologies by addressing key barriers. The research suggests that businesses could reduce waste management costs and generate new revenue streams by adopting anaerobic digestion and pyrolysis. Policymakers are encouraged to disincentivize landfills and promote WtE through financial incentives such as subsidies and energy credits. The implementation framework offers clear recommendations for integrating WtE into SA’s energy and waste management strategies, supporting both sustainability and economic goals. Social implications The main social contribution is the potential for WtE adoption to improve waste management practices and generate new job opportunities within the renewable energy and waste sectors. Originality/value This study provides a novel contribution by developing an implementation framework tailored to SA’s unique regulatory, economic and social contexts. The research highlights the importance of aligning WtE adoption with sustainability goals, reducing reliance on fossil fuels and promoting renewable energy. The framework serves as a practical guide for policymakers, businesses and industry leaders seeking to implement sustainable waste management solutions in SA.

Legal Nature of the Capital Commitment in Investment Partnership Agreement and Recovery of a Non-Performed Capital Call in the Investment Partnership

The article contains the analysis of the legal nature of “capital commitment”, i. e. the partner’s commitment to contribute capital to the partnership in one of the most popular legal forms of venture capital funds and private equity funds in Russia – investment partnership agreement. The author analyses the legislation of the Russian Federation, the case law and the investment partnership agreements entered into in practice in order to understand whether the capital contributed to the common property of the partners of the partnership by one of the partners is returnable or not, and is the managing partner entitled to recover the sum of capital that one of the partners has failed to contribute to the partnership in court.

Financing Startups and Their Role in a Company's Competitive Strategy

The article examines startup financing as a crucial factor in shaping a company’s competitive strategy. Startups are key elements of innovative development, helping companies adapt to rapid market changes by providing them with new technologies and business models. Various mechanisms for financing startups are explored, including venture capital funds, business angels, crowdfunding, incubators, and accelerators, with a focus on how these instruments support startups at different stages of their lifecycle-from pre-seed financing to scaling and market entry. The study highlights the role of startups in companies’ competitive strategies, particularly within the framework of differentiation and focus strategies. Funding innovative startups allows companies to gain access to unique solutions that significantly enhance their competitive market position. For example, companies such as L'Oréal and Google have utilized investments in startups like ModiFace and YouTube, respectively, to expand their market presence and create new products that have become the foundation of their success. An important component of the research is that investing in startups enables companies to diversify their activities, reduce risks, accelerate adaptation to new market conditions, and maintain flexibility. Startup financing, especially in the Ukrainian context, where the startup ecosystem is rapidly evolving, represents a promising direction for company development. Future research prospects lie in a detailed study of risk management models related to startup financing, as well as in analyzing successful examples of large companies’ interaction with startups. Additionally, it is crucial to examine the impact of government support and international investments on the development of the startup ecosystem in Ukraine.

Funding and its impact on the administration and organisational efficiency of technical vocational education and training institutions

In the present study, the author examines how the lack of funding can impact the administration and the organisational efficiency of technical vocational education and training (TVET) institutions (I). The research examines human capital development and TVET as instruments for propelling growth and development and contributing to Trinidad and Tobago’s (T&T) economic and social advancements. The study explored how TVETIs can be a central pillar in the progress of T&T’s development. The research material consists of 10 interviews with educational experts from four postsecondary TVETIs in T&T and the chief executive of T&T TVET’s regulatory body. Focus groups and individual interviews were conducted with the leading regulator, instructors, managers, and a curriculum expert. The author utilised thematic analysis in the research by adopting a deductive approach. The data revealed several challenges that engulf the administration and management of TVETI in T&T, mainly because of financial woes. Three themes emerged from the data: Funding for Administration, Funding for Human Capital Development and Funding for Organisational Efficiency. Insightful revelations were unearthed from the educational experts, which were generated from the data which provide an in-depth perspective on the administration and management of TVET in T&T. The results show that T&T’s education experts see funding as a significant challenge. Many argue that a lack of funding severely impacts their institutions, which erodes human capital development growth. The study concludes that a lack of funding can severely and has impacted TVET in several ways. An absence or a lack of funding brought the closure of top-notch schools used in the training and growth of teachers for the educational system. Human capital development and TVET were also highlighted as essential tools for economic and social deprivation. However, a better approach is needed to finance TVET moving forward.

Efektivitas Pembiayaan dalam Pemberdayaan Usaha Mikro pada KSPSS Al-Anshari Bukittinggi

The purpose of this research is to know and analyse the effectiveness of financing in micro business empowerment at Kspps AL-Anshari Bukittinggi. This research uses a qualitative descriptive approach, namely collecting data according to what is actually then compiled, processed, analysed to be able to provide an overview of the existing problems. The author obtained information and data from informants by using interviews with informants. The results of this research explain that the effectiveness of financing in the empowerment of micro businesses at Kspps AL-Anshari Bukittinggi, namely in an effort to empower micro businesses, Kspss Al- Anshari Bukittinggi provides business capital financing to customers who apply for a pinjama for mikto business capital, so that with the financing, the customer's income as a micro business entrepreneur can be said to be effective, because every customer who is studied, the average customer's income increases. The effectiveness of financing in micro business empowerment at Kspss Al-Anshari Bukittinggi for the last five years, namely in 2018-2022. In 2018 the effectiveness ratio rate is 77% (quite effective), in 2019 the effectiveness ratio is 83% (quite effective) and in 2022 the effectiveness ratio rate is 72% (quite effective) which is included in the criteria is quite effective. This is because the realisation achieved is still far enough to differ to meet the set target. In 2020, the effectiveness level is 104% (highly effective) due to the realisation that has reached the set target. In 2021 the effectiveness level of 32% (not effective) is the lowest effectiveness level, this is realised very much different from the target. From the results of the last five years from 2018-2022 it is said to be quite effective.

Do Public Financial Statements Influence Private Equity and Venture Capital Financing?

ABSTRACT We study whether the availability of public audited financial statements influences the probability of private firms receiving private firm equity financing. Using a setting in the EU with plausibly exogenous variability in the extent to which private firms issue public financial reports, we find that private firms subject to public reporting requirements have a higher probability of obtaining private equity (PE) financing. In addition, we show that the increase in PE financing occurs in industries in which PE funds have prior experience. Last, we show that our findings also extend to other forms of private firm financing such as private firm acquisitions and venture capital. Our evidence highlights the importance of public financial statements in the decision-making of PE investors, an important and understudied segment of the private firm financing market. Data Availability: Data are available from the public sources cited in the text. JEL Classifications: M41; M2; G24; G34.

Characteristics of financial capital flow circulation and the risk transmission effect in China

Financial capital is an important force driving China's economic modernisation. Examining the characteristics of financial capital flow circulation across sectors and risk transmission laws is crucial in guiding financial market operations and deepening financial system reforms. This study establishes a 2011–2020 China matrix that includes capital fund flow statements for non-financial corporations, financial institutions, the general government, households, and foreign sources and examines changes in capital flow circulation by developing a financial flow multiplier system model to measure the direct and indirect transmission effects of capital flows between sectors from the perspective of liabilities. Results show that China's overall scale of financial capital flows has increased, but fluctuations have emerged in the last decade. The sectors' financing structure has changed significantly, with financial institutions remaining the primary capital inflow and outflow sectors of the financial market; however, the proportion of liability and investment in the household sector has increased, resulting in increased risk transmission. Moreover, the sectoral fund surpluses and shortages are highly volatile and uncertain, with non-financial enterprises serving as the primary drivers of real-economy investment. The capital flow from financial services to the real economy shows a fluctuating growth trend, primarily flowing to non-financial corporations; however, the proportion exhibits a downwards trend. Finally, we find that the flow transmission relationship between different sectors and financial transactions in the financial market is complex, with both direct and indirect risk transmission effects between sectors. Changes of financial institutions' liabilities significantly affect the liabilities and investments of other sectors.

Entrepreneurial finance and sustainability: Do institutional investors impact the ESG performance of SMEs?

Institutional investors improve the environmental, social, and governance (ESG) performance of small- and medium-sized enterprises (SMEs). Our difference-in-differences framework shows that the backing from private equity and venture capital funds leads to an increase in SMEs’ externally validated ESG scores compared to their matched non-investor-backed peers. Consistent with “ESG-as-insurance” theory, the ESG performance of SMEs with a higher probability of failure is more likely to benefit from the backing of institutional investors. This positive effect is heterogeneous; while SMEs with high ex-ante ESG performance further improve their ESG performance following institutional investor backing, SMEs with low ex-ante ESG performance are unlikely to implement any improvements. Entrepreneurial finance seems to help sustainable entrepreneurs transform into “sustainability champions,” while neglecting the betterment of non-sustainable SMEs.

Contemporary Tibetan Monastic Business and the Corporate Form

In early twenty-first century Tibet, many Geluk monasteries established capital funds that they invested in small businesses—the Geluk being one of the main Tibetan Buddhist traditions. Drawing on fieldwork in northeast Tibet, this article examines debates surrounding this monastic engagement in business, asking why it proved contentious despite historical and canonical precedent. I approach this question by thinking about monastic business engagement in relation to Geluk monasticism as a distinctive corporate form. Foregrounding how monks made sense of what they were doing as corporate actors, I examine common rationales, concerns, and questions of legitimacy at the heart of arguments both for and against monastic business development, and how these related to the monastic corporation’s core concern with preservation and continuity. The article concludes with some broader reflections on what these debates can tell us about the ongoing process of corporation-making, suggesting some possible avenues for future research.

Machine learning private equity returns

In this paper, we use two machine learning techniques to learn the aggregated return time series of complete private capital fund segments. First, we propose Stochastic Discount Factor (SDF) model combination to determine the public factor exposure of private equity. Here, we describe our theoretical motivation to favor model combination over model selection. This entails that we apply simple coefficient averaging to obtain multivariate SDF models that mimic the factor exposure of all major private capital fund types. As a second step, we suggest componentwise L2 boosting to estimate the error-term time series associated with our factor models. The simple addition of the public factor model returns and the error terms then yields the total return time series. These return time series can be applied for proper integrated public and private risk management or benchmarking.

MyITS Services Integrated Service Innovation in Higher Education

The demands of higher education today are increasingly various and complicated as they provide technology and information-based services to students, lecturers, education staff, and alumni who need services easily and quickly. One solution is to integrate through the Integrated Service Centre, Institut Teknologi Sepuluh Nopember (ISC-ITS), by developing digitalization services through the myITS Services platform. The stages of innovation begin with legalisation services, translate diplomas, and graduation certificates, while future innovation development plans to expand into human capital services, finance, and cooperation. The purpose of this research is to analyze integrated service innovation in the Integrated Service Centre. This research uses qualitative methods and Albrecht and Zemke’s theory of public service innovation which examines technology-based services, human resources and service recipients. Data were obtained from observations, interviews, and documentation from service providers and recipients. The results of this study show that myITS Services can respond to the challenges of integrated service innovation needs at the Integrated Service Centre, as a university in realizing digital transformation and as an effort to implement Good University Governance (GUG), but that human resources teams must be supported and assistance provided for service recipients. As innovation continues to be carried out in public service, breakthroughs ISC-ITS come in the form of creative original ideas and adaptations and modifications to existing working methods to provide benefits, both directly and indirectly, to stakeholders. Keywords: innovation, public service, myITS Services

Does the disclosure of ESG information by private equity firms impact the success of their fundraising efforts?

This study examines the impact of private equity fund managers' (GPs') ESG disclosure on fundraising. To this end, a sample of global private equity and venture capital funds that completed fundraising between 2020 and 2022 is employed. Our findings indicate that an increase in ESG disclosure by GPs is associated with an increase in fundraising. This indicates that GPs' ESG disclosure diminishes information asymmetry and has a favorable impact on fundraising. Conversely, the level of ESG disclosure among limited partners (LPs) has no significant impact on the relationship between GPs' ESG disclosure level and fundraising. The findings of this study have significant implications for private equity stakeholders, including GPs, given the current context of declining investment demand due to rising interest rates, recessionary concerns, poor performance and tighter regulations on private equity management. In this environment, ESG disclosure is becoming increasingly challenging for private equity firms to utilize as a fundraising strategy.

Insights for sustainable business practices: Comparative impact of independent and corporate venture capital funding on financial and environmental performance

This study aims to analyze the effects of venture capital (VC) financing schemes on the financial and environmental performance of their VC-backed companies. This research leverages a dataset including 325 U.S. firms between 2002 and 2022 and examines two issues of interest: independent venture capital (IVC) and corporate venture capital (CVC) funding. The results show that IVC-backed companies have significantly better environmental, social, and governance (ESG) ratings and emit fewer greenhouse gases (GHG) emissions when compared to companies backed by CVC. This highlights that the function of IVC is to improve the environmental sustainability of businesses. Together this helps provide a valuable perspective about which VC models (CVC, IVC) does have an impact on how businesses pursue sustainability practices alongside financial performance. This paper contributes to the sustainable entrepreneurship literature by focusing on the importance of funding types with performing sustainable practices.

Determinants of environmental sustainability in the United States: analyzing the role of financial development and stock market capitalization using LCC framework

This research investigates how the USA's load capacity factor (LCF) has been impacted by trade openness, financial development, stock market capitalization, and industrialization over the period 1990–2022. This study also tests the “Load Capacity Curve (LCC)” hypothesis. Various unit root tests were conducted to determine the stationarity of the dataset, revealing that the variables are free from unit root problems and exhibit mixed orders of integration. The “Autoregressive Distributed Lag (ARDL)” bounds test confirmed co-integration among the variables. The results from the ARDL model validated the existence of the LCC hypothesis in the USA. The findings also demonstrated that industrialization is positively correlated with LCF, whereas financial development, stock market capitalization, and trade openness are negatively correlated with LCF. To ensure the robustness of the ARDL estimations, the study also employed several regressions, all of which confirmed the validity of the ARDL results. Additionally, pairwise Granger causality tests revealed unidirectional causal relationships between GDP and LCF, stock market capitalization and LCF, and industrialization and LCF, while no causal relationships were found between financial development and LCF and trade openness and LCF. The findings advocate that the USA should advance eco-friendly industrial practices to ensure environmental sustainability, alongside regulated financial markets and institutions that mandate the utilization of green investments.

Pengaruh Financial Distress pada Trade Credit Provisions pada Perusahaan Manufaktur di BEI

Purpose: (IDX) period 2018-2023 by focusing on Financial Distress conditions on Trade Credit Provisions. Financial distress is identified through delisting conditions due to negative net income and book value and inappropriate management decisions. Methodology: Through a quantitative approach with 46 samples of companies selected based on stratified random sampling and purposive sampling methods. Results: The results of the analysis show that there is a significant negative relationship between financial difficulties and accounts payable and there is a significant negative relationship between financial difficulties and accounts receivable in the shares of manufacturing sector companies on the IDX. Limitations: The limitations of this research are only on financial distress and manufacturing sector companies 2018-2023 Contribution: It is therefore worth considering a deeper exploration of how internal mechanisms, such as working capital management and financing strategies, play a role in determining trade credit policies.

Biopharmaceutical pipeline funded by venture capital firms, 2014 to 2024.

Venture capital (VC) firms fund biopharmaceutical research and development (R&D) while incurring substantial financial risk. VC firms seek to invest in clinical areas with the greatest potential for financial return. Using a combination of data for clinical trials and VC investment deals between January 2014 and March 2024, we found that approximately 75% of VC investments were allocated to clinical trials studying small-molecule drugs compared to biologics or gene therapies, without substantial changes over the study period. Most of VC firms' investment in biopharmaceutical R&D was concentrated in phase 1 and phase 2 clinical trials. This trend has increased in recent years, with phase 1 trials accounting for nearly half of total deals and capital investments in 2023. VC investments were concentrated in several therapeutic areas, including cancer.