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Opening the Black Box

Liljeblad, Mårten LU ; Hjorth, Sebastian LU and Jidorf, Axel LU (2022) IBUH19 20221
Department of Business Administration
Abstract
Purpose
The purpose of this study is to examine how underwriter reputation, VC-backing and offering size affected the fees paid to underwriters on Nasdaq First North during the time period 01-01-2021 to 31-12-2021. In doing so, the study aims to contribute to a more comprehensive theoretical understanding of the entire cost image associated with going public.

Methodology
The authors decided to use a quantitative method and a deductive approach to conduct this study.

Theoretical perspectives
The study is conducted on the basis of previous research regarding underwriting fees, underwriter reputation, venture capital backing, offering size, and initial public offerings. This is combined with the agency, information asymmetry,... (More)
Purpose
The purpose of this study is to examine how underwriter reputation, VC-backing and offering size affected the fees paid to underwriters on Nasdaq First North during the time period 01-01-2021 to 31-12-2021. In doing so, the study aims to contribute to a more comprehensive theoretical understanding of the entire cost image associated with going public.

Methodology
The authors decided to use a quantitative method and a deductive approach to conduct this study.

Theoretical perspectives
The study is conducted on the basis of previous research regarding underwriting fees, underwriter reputation, venture capital backing, offering size, and initial public offerings. This is combined with the agency, information asymmetry, certification hypothesis and hot market theories.

Empirical foundation
The empirical data consists of information derived from a sample size of 33 initial public offerings. Information was gathered through a web based self-completion questionnaire.

Conclusions
The results show that underwriter reputation has a positive significant correlation with and the offering size has a significant negative correlation to the fee paid to underwriters. Venture-capital backing was concluded not to have a significant effect on this fee. Our model was able to explain 49% of the variation in the underwriting fee. (Less)
Please use this url to cite or link to this publication:
author
Liljeblad, Mårten LU ; Hjorth, Sebastian LU and Jidorf, Axel LU
supervisor
organization
course
IBUH19 20221
year
type
M2 - Bachelor Degree
subject
keywords
Initial Public Offering, Underwriting fee, IPO Gross Proceeds, Bookrunner, Nasdaq First North, Underwriter reputation, Venture capital, Offering size
language
English
id
9083913
date added to LUP
2022-08-01 12:56:14
date last changed
2022-08-01 12:56:14
@misc{9083913,
  abstract     = {{Purpose
The purpose of this study is to examine how underwriter reputation, VC-backing and offering size affected the fees paid to underwriters on Nasdaq First North during the time period 01-01-2021 to 31-12-2021. In doing so, the study aims to contribute to a more comprehensive theoretical understanding of the entire cost image associated with going public.
 
Methodology
The authors decided to use a quantitative method and a deductive approach to conduct this study. 

Theoretical perspectives 
The study is conducted on the basis of previous research regarding underwriting fees, underwriter reputation, venture capital backing, offering size, and initial public offerings. This is combined with the agency, information asymmetry, certification hypothesis and hot market theories.
 
Empirical foundation
The empirical data consists of information derived from a sample size of 33 initial public offerings. Information was gathered through a web based self-completion questionnaire. 

Conclusions
The results show that underwriter reputation has a positive significant correlation with and the offering size has a significant negative correlation to the fee paid to underwriters. Venture-capital backing was concluded not to have a significant effect on this fee. Our model was able to explain 49% of the variation in the underwriting fee.}},
  author       = {{Liljeblad, Mårten and Hjorth, Sebastian and Jidorf, Axel}},
  language     = {{eng}},
  note         = {{Student Paper}},
  title        = {{Opening the Black Box}},
  year         = {{2022}},
}