An interesting trend is developing in the private equity world: the rise of “secondaries.” The business model of private-equity companies “scouring obscure corners of the business world” for undervalued firms is becoming a thing of the past.1 Instead, the idea of purchasing companies owned by other private equity firms is slowly gathering momentum. This type…
Category: Blog Articles
Touchdown or Fumble? The Risks and Returns of Investment Opportunities in Professional Athletics
The start-up company Fantex Holdings and its newly created trading exchange for investors to buy and sell interests in professional athletes have recently shed light upon the intersection of venture capital and professional athletics1 Fantex Holdings has created stocks tied directly to an athlete’s financial performance; a progressive venture that is backed by executives from…
The Line for Food Is Getting Longer for Venture Capitalists
Recently, there has been a surge of interest in food among Americans. More people obsess about particular superfoods, check which farms certain ingredients come from, and become fans of certain celebrity chefs.1 Packaged gourmet foods, as well as foreign foods, are being sold at an unprecedented rate, and food co-op membership is at an all-time…
Buy or Sell: Geithner’s New Gig
Timothy Geithner served as the United States Secretary of the Treasury until January of this year. During his past four years in office Mr. Geithner has been an extremely polarizing figure in the financial world. His tenure was defined mostly by his dealings with the fallout of the recession. He is the name, perhaps unfairly,…
To Go Public or Not to Go Public? The Pros and Cons of Publicly Traded Private Equity
In private equity, one of the main strategies employed by private equity firms when purchasing a public portfolio company, is to subsequently take that company private. This is believed to be beneficial because it allows the private equity fund and the management of the portfolio company to operate the business without pressure from shareholders, allowing…
The $3 Billion Snapchat: Here Today, Gone Tomorrow?
The news first broke last week that Snapchat, the disappearing picture mobile app, had received an offer from Facebook to buy the two-year-old company for $3 billion in cash.1 But Snapchat’s 23-year-old co-founder and CEO, Evan Spiegel, turned down the offer that likely would have made him the world’s youngest billionaire.2 To most Americans, who…
The Volcker Rule: Implementation Imminent or Unlikely?
Paul Volcker, former United States Federal Reserve Chairman and originator of the Volcker Rule, was appointed to the President’s Economic Recovery Advisory Board in early 20091 The board was created with the intent to advise the Obama Administration on economic recovery matters. The creation of the board also gave Volcker the platform to lay the…
Experience and Logic?: The Strine Decision
The Strine Decision On October 23, 2013, the Third Circuit Court of Appeals declared the Delaware Chancery Court’s arbitration system unconstitutional.1 The arbitration system at issue was codified in the Delaware Code2 as well as the Rules of the Delaware Court of Chancery.3 Delaware’s program, established in 20094 provided for arbitration by a Delaware chancery…
The JOBS Act Seen Through the Twitter Lens
In February of last year, Facebook issued a press release announcing that it had filed the required paperwork for its upcoming initial public offering (IPO) with the Securities and Exchange Commission.1 Shortly thereafter, the SEC published Facebook’s 150-page filing, making it immediately available for public scrutiny.2 Just a few weeks ago, Twitter published a similar…
The South Korean Government and Venture Capital: The Costs of Planned Growth
Unlike the U.S. government, the Korean government plays an active and major role in its nation’s venture capital market. Under the “Special Law to Promote Venture Capital Companies (SLPVCC)” passed in 1997, the Korean government is permitted to provide subsidies to select venture capital-backed companies (e.g., companies involved in energy, IT, and electronics), grant tax…