Management and Organizational Studies 3370A/B Study Guide - Quiz Guide: Investment Banking, Dutch Auction, Dividend

• School: Western University
• Department: Management and Organizational Studies
• Course: Management and Organizational Studies 3370A/B
• Professor: Maria Ferraro

Document Summary

A significant number of venture capital firms focus on mature businesses. After the ipo, there is a less active secondary market for the firm"s shares. Only smaller amounts of capital can be raised through an ipo than the amount that can be raised through private sources. Publicly traded firms find it easier to attract top management talent. Going public can enable an entrepreneur to fund a growing business but not without giving up control. Stock prices drop on the ex-dividend date, but usually the drop is less than the amount of the dividend. Paying a stock dividend will transfer value to the companys stockholders. Privately held firms find it easier to attract top management talent and to better motivate current managers. Private companies often don"t announce dividend payments because private company shares are not frequently traded and the list of shareholders is relatively small. The record date should never come before the ex-dividend date.