Module 4: Financial Intermediaries

This module aims to answer the following questions:

1. What is venture capital and angel financing?
2. If and how do financial intermediaries solve financing frictions faced by entrepreneurial firms?

Required and Suggested Readings

Read the following papers and skim the articles on the week 4 reading list.

Paper 1

Bernstein, S. et al. (2022) ‘Do Startups Benefit from Their Investors’ Reputation? Evidence from a Randomized Field Experiment’.

Paper 2

Gompers, Paul A., Will Gornall, Steven N. Kaplan, and Ilya A. Strebulaev. “How do venture capitalists make decisions?” Journal of Financial Economics 135, no. 1 (2020): 169-190.

Paper 3

Hsu, D. H. (2004). “What do entrepreneurs pay for venture capital affiliation?” The Journal of Finance, 59(4), 1805-1844.