UCL Department of Economics


Finance Seminar - Ludovic Phalippou (Oxford)

25 October 2023, 4:00 pm–5:15 pm


Painful Goodbyes: Employee Satisfaction & VC Exit Routes

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Ji Hee Yoon

Abstract: Employee satisfaction decreases sharply when Venture Capitalists (VCs) exit an investment. We show that the drop is related to the exit route and not to other firm characteristics such as firm age and industry. The drop is the largest when the exit is via a Leveraged Buy-Out; the drop is significant but weaker when exiting via an IPO, and small when the exit route is a trade sale.
Textual analysis of employee reviews using both standard technique (STM) and ChatGPT point to issues related to management and operational issues rather than issues around salaries or work life balance.

Location: Zoom

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