An Empirical Study of the Impact of CEO Characteristics on New Firms' Time to IPO

Authors

Qin Yang, Robert Morris University
Monica Zimmerman, West Chester University
Crystal X. Jiang, Bryant University

Document Type

Article

Comments

Published by Wiley-Blackwell in the Journal of Small Business Management, volume 49 issue 2, 2011.

Keywords

going public (securities); corporate finance; business entreprises; investors; computer software industry

Publisher

Wiley Blackwell

Publication Source

Journal of Small Business Management

Rights Management

Copyright of Taylor & Francis, Ltd.

Abstract

An initial public offering (IPO) is one of the most critical events in the life of a firm. As the IPO market continues to attract attention from both entrepreneurs and investors, research examining the relationship between the firm's characteristics and its IPO performance is growing. In this paper, we use the upper echelon perspective to empirically examine the relationship between the firm's chief executive officer (CEO) and the firm's time to IPO, a relationship that has so far received little attention. Using data obtained from 237 IPOs in the U.S. software industry, we found that the CEO's prior executive experience, network, and age are significantly related to the new firm's time to IPO. This study extends the understanding of the important role of the CEO in the IPO and provides investors greater insight into those variables that influence the speed with which firms go public.