Venture capital financing : screening and contracting under assymetric information

Structure of the Thesis This thesis consists of 5 sections. Section 1 starts with the problem definition and the presentation of the objectives of this thesis. Section 2 introduces a presentation of the theoretical foundations of Venture financing and a review of the main theories developed on Venture investing. It includes a taxonomy of contracting clauses relevant in venture contracting, the conflicts they address, and presents some general observations on contractual clauses. Section 3 presents the research findings on the analysis of a European VC's deal flow and investment screening linked to the prevailing market conditions. Section 4 focuses an empirical study of a European VC's investment process, the criteria it uses to make its investments. It presents empirical findings on the investment criteria over time, business cycles, and investment types. It also links these criteria to the VC's subsequent performance. Finally, section 5 presents an empirical research on the comparison of the legal contracts signed between European and United States Venture Capitalists and the companies they finance. This research highlights some of the contracting practices in Europe and the United States.

Disentangling the link between health and social capital: A comparison of immigrant and native-born populations in Spain

An increasing body of research has pointed to the relevance of social capital in studying a great variety of socio-economic phenomena, ranging from economics growth and development to educational attainment and public health. Conceptually, our paper is framed within the debates about the possible links between health and social capital, on one hand, and within the hypotheses regarding the importance of social and community networks in all stages of the dynamics of international migration, on the other hand. Our primary objective is to explore the ways social relations contribute to health differences between the immigrants and the native-born population of Spain. We also try to reveal differences in the nature of the social networks of foreign-born, as compared to that of the native-born persons. The empirical analysis is based on an individual-level data coming from the 2006 Spanish Health Survey, which contains a representative sample of the immigrant population. To assess the relationship between various health indicators (self-assessed health, chronic conditions and long-term illness) and social capital, controlling for other covariates, we estimate multilevel models separately for the two population groups of interest. In the estimates we distinguish between individual and community-level social capital. While the Health Survey contains information that allows us to define individual social capital measures, the collective indicators come from other official sources. In particular, for the subsample of immigrants, we proxy community-level networks and relationships by variables contained in the Spanish National Survey of Immigrants 2007. The results obtained so far point to the relevance of social capital as a covariate in the health equation, although, the significance varies according to the specific health indicator used. Additionally, and contrary to what is expected, immigrants’ social networks seem to be inferior to those of the native-born population in many aspects; and they also affect immigrant’s health to a lesser extent. Policy implications of the findings are discussed. Keywords: health status, social capital, immigration, Spain

An application of capital allocation principles to operational risk

The cost of operational risk refers to the capital needed to a fford the loss generated by ordinary activities of a firm. In this work we demonstrate how allocation principles can be used to the subdivision of the aggregate capital so that the firm can distribute this cost across its various constituents that generate operational risk. Several capital allocation principles are revised. Proportional allocation allows to calculate a relative risk premium to be charged to each unit. An example of fraud risk in the banking sector is presented and some correlation scenarios between business lines are compared. Keywords: solvency, quantile, value at risk, copulas

Correlations between negative-induced cerebral dynamics and idiopathic intellectual disability: an EEG study

Intellectual disability has long been associated with deficits in socio-emotional processing. However, studies investigating brain dynamics of maladaptive socio-emotional skills associated with intellectual disability are scarce. Here, we compared differences in brain activity between low intelligence quotient (I.Q.<75, N=13) and normal controls (N=15) while evaluating their subjective emotions. Positive (P) and negative (N) valenced pictures were presented one at a time to participants of both groups, at a rate of ¾. The task required that each participant evaluate their subjective emotion and press a predefined push-button when done, alternatively P and N. Electroencephalographic (EEG) signals were continuously recorded, and the 1000ms time window following each picture was analyzed offline for power in frequency domain. Alpha low (8-10Hz) and upper (10-13Hz) frequency bands were then compared for both groups and for both P and N emotions in 12 distributed scalp electrodes. The qualitative evaluation of emotions was similar between both groups, with constant longer reaction times for the low IQ participants. The EEG signal comparison shows marked power decrease in upper alpha frequency range for N emotions in low intelligence group. Otherwise no significant difference was noticed between low and normal IQ. Main findings of the present study are (1) results do not support the hypothesis that impairment in developmental intelligence roots in maladaptive emotional processing; (2) the strong alpha power suppression during negative-induced emotions suggests the involvement of an extended neural network and more effortful inhibition processes than positive ones. We call for further studies with a larger sample.

Human Capital Questionnaire (PHCQ): Assessment of European nurses' perception as indicators of human capital quality

Healthcare accreditation models generally include indicators related to healthcare employees' perceptions (e.g. satisfaction, career development, and health safety). During the accreditation process, organizations are asked to demonstrate the methods with which assessments are made. However, none of the models provide standardized systems for the assessment of employees. In this study, we analyzed the psychometric properties of an instrument for the assessment of nurses' perceptions as indicators of human capital quality in healthcare organizations. The Human Capital Questionnaire was applied to a sample of 902 nurses in four European countries (Spain, Portugal, Poland, and the UK). Exploratory factor analysis identified six factors: satisfaction with leadership, identification and commitment, satisfaction with participation, staff well-being, career development opportunities, and motivation. The results showed the validity and reliability of the questionnaire, which when applied to healthcare organizations, provide a better understanding of nurses' perceptions, and is a parsimonious instrument for assessment and organizational accreditation. From a practical point of view, improving the quality of human capital, by analyzing nurses and other healthcare employees' perceptions, is related to workforce empowerment.

Vision, spatial cognition and intellectual disability.

Vision is the most synthetic sensory channel and it provides specific information about the relative position of distant landmarks during visual exploration. In this paper we propose that visual exploration, as assessed by the recording of eye movements, offers an original method to analyze spatial cognition and to reveal alternative adaptation strategies in people with intellectual disabilities (ID). Our general assumption is that eye movement exploration may simultaneously reveal whether, why, and how, compensatory strategies point to specific difficulties related to neurological symptoms. An understanding of these strategies will also help in the development of optimal rehabilitation procedures.

L'educació des del punt de vista racional. El currículum conceptual i procediment evolutiu, els programes de desenvolupament intel·lectual

L’article centra, en primer lloc, el sentit del títol: l’educació que potencia la refl exió lògica i racional, suportada en el còrtex cerebral, i la situació educativa actual, que no té establert amb claredat un currículum educatiu específi c per a l’ensenyament obligatori sobre actituds, sociabilitat, valors, emocionabilitat i creativitat. D’altra banda, es propugnen programes de desenvolupament intellectual molt útils, molts dels quals se centren en el treball que suporta la part cortical del cervell: lògica i operacions mentals deductives, inductives… Per tant, tenim currículums centrats en aspectes racionals que, paradoxalment, requereixen programes transversals sobre aspectes també racionals i, a més, obliden aspectes emocionals i creatius. Finalment, es fan dues propostes-suggeriments: una revisió del currículum basada en les aportacions de les neurociències, i la focalització del currículum en el desenvolupament harmònic de la persona, centrat en quatre pilars: Saber, Fer, Estar i Innovar. Les recents lleis educatives, però, no ho contemplen.

Timing of Capacity Change: Models for Capital Intensive Industry

The suitable timing of capacity investments is a remarkable issue especially in capital intensive industries. Despite its importance, fairly few studies have been published on the topic. In the present study models for the timing of capacity change in capital intensive industry are developed. The study considers mainly the optimal timing of single capacity changes. The review of earlier research describes connections between cost, capacity and timing literature, and empirical examples are used to describe the starting point of the study and to test the developed models. The study includes four models, which describe the timing question from different perspectives. The first model, which minimizes unit costs, has been built for capacity expansion and replacement situations. It is shown that the optimal timing of an investment can be presented with the capacity and cost advantage ratios. After the unit cost minimization model the view is extended to the direction of profit maximization. The second model states that early investments are preferable if the change of fixed costs is small compared to the change of the contribution margin. The third model is a numerical discounted cash flow model, which emphasizes the roles of start-up time, capacity utilization rate and value of waiting as drivers of the profitable timing of a project. The last model expands the view from project level to company level and connects the flexibility of assets and cost structures to the timing problem. The main results of the research are the solutions of the models and analysis or simulations done with the models. The relevance and applicability of the results are verified by evaluating the logic of the models and by numerical cases.

The double-edged sword of social capital: Three essays on entrepreneurship in developing nations

ABSTRACT My study seeks to answer the main question: "how does entrepreneurs' social capital positively and negatively affect their resource mobilization efforts, and exploitation of entrepreneurial opportunity?" To answer this question, I develop a model for examining positive and negative effects of social capital on resource accumulation by entrepreneurs, and the subsequent effect of resource accumulation on the exploitation of entrepreneurial opportunity, and utilize data from Africa to ëmpirically test the relationships in this model. Developing nations are a suitable context because: a) They require entrepreneurship for economic development, b) They have received less attention in management and entrepreneurship research, c) Because of inadequately-developed institutions, entrepreneurs from developing nations face major resource mobilization challenges hence they often turn to their social ties for resources, and d) The communalistic and collectivistic nature of most developing nations -encouraging support and sharing of resources- may help us better understand how society's values and structures may contribute and also deduct firm resources. My study reveals that social capital contributes resources to entrepreneurs in developing nations at a cost that takes away resources, and that more resources but lower costs facilitate entrepreneurial opportunity exploitation. For entrepreneurs in developing nations, large networks, greater shared identity, and more trust are beneficial. To increase chances of raising more resources, entrepreneurs from communalistic societies should include network members from outside their communities. Besides providing financial support, policy-makers should develop training programs and advisory services on configuration of entrepreneurs' networks so as to achieve more resources at a low cost. My study insights can help improve entrepreneurs' resource accumulation efforts and the subsequent growth of their firms, leading to the overall economic growth of developing nations.