http://www.merlot.org:80/merlot/ A search of MERLOT materials Copyright 1997-2013 MERLOT. All rights reserved. Thu, 20 Jun 2013 01:18:48 PDT Thu, 20 Jun 2013 01:18:48 PDT http://www.merlot.org:80/merlot/images/merlot.gif http://www.merlot.org:80/merlot/ 44 34 http://www.merlot.org/merlot/viewMaterial.htm?id=531416 To most people entrepreneurship is solely about innovation and entering a new venture. For example, Hisrich and Peters (2002) define entrepreneurship as “the process of creating something new with value by devoting the necessary time and effort, assuming the accompanying financial, psychic, and social risks, and receiving the resulting rewards of monetary and personal satisfaction and independence.” According to Kuratko and Welsch (1994) “Many people now regard entrepreneurship as „pioneership? on the business frontier.” Bygrave (1994) begins with Schumpeter?s definition of an entrepreneur and continues to argue that only a few businesses would have the potential to fit Schumpeterian definition on entrepreneurship, destroying the existing economic order by introducing new product and services. Instead, he argues that “the vast majority of new businesses enter existing markets.” To him, an entrepreneur is “someone who perceives an opportunity and creates an organization to pursue it” and the entrepreneurship involves “all the functions, activities, and actions associated with perceiving opportunities and creating organizations to pursue them.” In all these discussions, exiting from a market is not considered as part of entrepreneurial activities. http://www.merlot.org/merlot/viewMaterial.htm?id=531392 For the past fifty years in the United States, venture capital (VC) has provided initial funding to innovative entrepreneurial enterprises, while the European venture capital industry has only really emerged over the past decade. Using quarterly data from 1993 to 2003, this paper examines and compares the return and risk performance of venture capital funds in US and Europe. Several results are noteworthy. First, pooled venture capital returns in US and Europe are 3.273% and 0.765% (on a quarterly basis) above the CAPM market risk-adjusted returns, respectively. Second, US venture capital fund performance dominates that of Europe in all measures: mean return, total-risk adjusted return, and market-risk adjusted return. Third, the linkage between US VC fund performance and the US stock market is much stronger than the co-movement between the European VC and European stock market. Finally, the introduction of Euro.NM in 1997 has substantially enhanced the relationship between the venture capital and stock market performance in Europe. http://www.merlot.org/merlot/viewMaterial.htm?id=531410 The paper examines the liquidity risk of a private equity firm that decides to dispose of a large holding in its portfolio. As the sale takes time, it requires a careful balancing act of the exposure to the fluctuations in the market value of the investment against the large sale-induced price depression. A mean-standard deviation utility framework is an appealing decision tool for optimizing protracted asset dispositions. The firm maximizes the expected profit from the sale strategy net of the price concession minus a penalty function for exposure to the price risk, with the penalty weight related to a loss confidence interval. http://www.merlot.org/merlot/viewMaterial.htm?id=531207 This study measured the impacts of the industrial characteristics and the fiscal incentives that influenced foreign direct investment. We used the fixed effect model with a 2SLS simultaneous equation for the period of rapid economic growth from 1980 to 1996 across nine industries is Taiwan. We found that the wage and market size are positively correlated with foreign national investors, while exports are negatively correlated with overseas Chinese investors. The results also indicated that the tax holiday and the statute for the promotion of upgrading industries affect foreign national investors positively, but that R&D tax credits are ineffective. The relatively high effective tax rates may not deter investments by foreign national investors, thus providing more profitability to a region of economic growth, such as Taiwan. In addition, the profitability of overseas Chinese investors is supported by asset efficiency. http://www.merlot.org/merlot/viewMaterial.htm?id=525848 In this article we test the value proposition hypothesis of supply chain management (SCM) by examining survey results of 570 US managers. First, we find that large firms use SCM initiatives significantly more than small firms. Second, in univariate and multivariate tests, we find that SCM leads to significant improvements in asset utilization, revenue generation, and competitive performance, regardless of firm size. These two major findings suggest that managers at small firms that are not actively engaged in SCM should reevaluate their opportunity to capture the competitive benefits of SCM that many large firms currently enjoy. http://www.merlot.org/merlot/viewMaterial.htm?id=526197 This paper studies venture capital investment activity in the United States stratified by both locations and industries. Is geographical location an important factor to venture capital investment? Is industry classification important in explaining the amount of dollars invested in venture capital? This paper is motivatd by the reemerging importance of economic geography, and the recognition that industrial location is fundamental to understanding the field of economic geography. The quarterly data are from the MoneyTree Survey, a regularly used source for the financial community. This study affirms that location and industry are important in explaining investment trends in venture capital. http://www.merlot.org/merlot/viewMaterial.htm?id=526167 Changing conditions in the angel market offer a unique opportunity to further knowledge and understanding about angel investing in the US during times of economic volatility. To identify trends in the angel market, this research examines changes in characteristics and investment behavior during a time of market expansion and contraction (2000 to 2001). While business angels remain the leading source of seed capital for business ventures, depressed yield rates and increased due diligence indicate that investors are retreating to more fundamental approaches. http://www.merlot.org/merlot/viewMaterial.htm?id=531391 This paper investigates the actual performance of 2,895 Initial Public Offerings of companies that were backed by venture capital from 1968 through 1998. It seeks to refute the myth that investors demand very high annualized and cumulative rates of return to compensate for the risks they are taking by financing ventures. In fact, it argues that, based on historical statistics, the total returns of the venture capital market are reasonable given the level of risk. This is done by concentrating on sections of various types of industries that have been supported by venture capital. http://www.merlot.org/merlot/viewMaterial.htm?id=531366 This paper investigates the actual performance of 2,678 Initial Public Offerings (IPOs) of companies that were backed by venture capital from 1969 to 2002. The main purpose is to compare the annual returns of the venture capital industry during the 1980s and 1990s. Comparisons between the decades provide some reasoning for the increased media coverage of the industry. There is no doubt that the media is fascinated by the release of any good news concerned with venture capital. For example, many people are familiar with the recent venture-backed Initial Public Offering (IPO) of Google, which brought in $1.7 billion on its opening day in August 2004. The shares of Google have risen by almost 50 percent since then (Wall Street Journal, October 1, 2004, Page C15). One hears much less about companies such as Nanosys Inc. or PlanOut Inc., which postponed their IPOs, citing uncertain market conditions. Nowadays, one often hears about the biotechnology sector that draws big bucks as financial analysts refer to this sector. Recent examples include Avera Pharmaceuticals Inc., a developer and licensor of treatments for neurological and psychiatric disorders who raised $48 million in a third round of financing, or Sophrion Therapeutics inc., a maker of oncology, asthma and allergy drugs who raised $47 million in a second round. Achievements in the telecommunication sector are also widely publicized, recent examples of which include ABS Capital leading a $23 million round of investment in ControlPoint Solutions Inc., a company whose products target telecommunications cost-management problems, and BridgePort Networks Inc., a manufacturer of products that link mobile and internet telephone calls who raised $25 million in a second round. http://www.merlot.org/merlot/viewMaterial.htm?id=526436 Money laundering, which is closely linked with tax evasion and informal trade, is facilitated by the poorly regulated financial institutions of "mafia nations״. These nations make billions of dollars by laundering money and giving safe haven to drug dealers and corrupt politicians, allowing them to transfer money globally. Money laundering prevention policies require financial institutions to periodically update their customer's personal information. Furthermore, they attemp to match tax and transaction reports collected from banks and non-banks around the world to detect tax evasion. This research explains how efficient policies for preventing money laundering can help reduce tax evasion.