Published in:Robert H. Smith School Research Paper ; No. RHS 06-029
Extent:
1 Online-Ressource (59 p)
Language:
Not determined
DOI:
10.2139/ssrn.899100
Identifier:
Origination:
Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments April 24, 2006 erstellt
Description:
We present four stylized facts about the Dot Com Era: (1) there was a widespread belief in a Get Big Fast business strategy; (2) the increase and decrease in public and private equity investment was most prominent in the internet and information technology sectors; (3) the survival rate of dot com firms is on par or higher than other emerging industries; and (4) firm survival is independent of private equity funding. To connect these findings we offer a herding model that accommodates a divergence between the information and incentives of venture capitalists and their investors. A Get Big Fast belief cascade may have led to overly focused investment in too few internet startups and, as a result, too little entry