Corporate governance implications of new methods of entrepreneurial firm formation

• Published date: 01 March 2017
• Author: Silvio Vismara,Douglas J. Cumming,David Ahlstrom
• DOI: http://doi.org/10.1111/corg.12189
• Date: 01 March 2017

CALL FOR PAPERS

Corporate governance implications of new methods of

entrepreneurial firm formation

David Ahlstrom

1

|Douglas J. Cumming

2

|Silvio Vismara

3,4

1

CUHK Business School, The Chinese University of Hong Kong, China

2

Schulich School of Business, York University, Canada

3

University of Bergamo, Italy

4

University of Augsburg, Germany

1|BACKGROUND OF THE SPECIAL ISSUE

From May 2016, small businesses and start‐ups can sell shares to the

American general public on crowdfunding portals. The US Securities

and Exchange Commission has indeed finally defined the rules that

make equity crowdfunding a legal means by which to raise seed capital

online. The crowdfunding phenomenon is now likely to spread globally.

Though an emerging field of study, a number of papers and special

issues have already been dedicated to crowdfunding from different

streams of research, including entrepreneurship, marketing and infor-

mation systems. As in other entrepreneurial finance markets, informa-

tion asymmetries between insiders and outsiders ingenerate agency

concerns. As in IPOs, for instance, the ownership base of entrepreneur-

ial ventures raising capital in crowdfunding is opened for the first time

to external shareholders. Crowdfunding platforms allow fundraising

from a pool of online backers, and will need to cope with collective‐

action problems as crowd‐investors have neither the ability nor the

incentive, due to the small investments, to devote substantial resources

to due diligence. While the above mentioned collective action problems

limit investors' monitoring incentives, entrepreneurs can be tempted to

shirk and engage in self‐dealing. The perspective of corporate gover-

nance research is needed to address these questions. To this end,

new research papers could be developed around the following themes:

1. How to treat agency conflicts arising from the separation

between ownership and control (principal‐agent) and between

controlling and minority shareholders (principal‐principal) in

crowdfunding markets?

2. While most of recent IPOs are offered exclusively to institutional

investors, crowdfunding investors are likely to be more diverse

than shareholders of newly listed companies. How does this

impact on corporate governance mechanisms?

3. Existing papers on crowdfunding focus on the success factors of

the campaigns. The ultimate goal of crowdfunding, however, is

to build an enduring business. What happens after the campaigns?

4. Globalization and technological innovation interact in their effect

on crowdfunding, since the reduction in communications costs

due to technological innovation have made cross‐border invest-

ments easier (e.g. reduced costs of monitoring investments over

long distances). Which are the implications for the governance

of entrepreneurial ventures?

5. Corporate governance practices in crowdfunding differ across

countries. Will recent trends and innovation in financing means

reduce such differences? Why should these be persistent?

How can we differentiate the role of legal institutions from that

of the culture and the social capital in determining such

differences?

2|SUBMISSIONS AND REVIEW PROCESS

A paper development workshop will be held at the University of

Bergamo (Italy), on June 7–8, 2017. Attendance is encouraged but

optional. Keynote speakers will be David Audretsch, Indiana Univer-

sity, and Erik Lehmann, University of Augsburg. The guest editors will

be available at this conference to assist in the development of

research. There will not be a conference fee.

The deadline for submission to the workshop is March 15, 2017.

Submissions should be sent to Silvio Vismara at silvio.vismara@unibg.

it with the subject line “CGIR Special Issue Conference”. Notifications

about acceptance will be sent by March 30, 2017.

Fully developed manuscripts should be submitted to CGIR by

August 1, 2017. All manuscripts submitted to the special issue should

be submitted through the CGIR Manuscript Central website http://

mc.manuscriptcentral.com/CGIR. Contributors should follow the CGIR

Author Guidelines (which can be found at www.cgir.org).

Final decisions on papers for the CGIR Special Issue will be

made later in the year. Please note that acceptance to the work-

shop does not necessarily guarantee acceptance to the CGIR

special issue.

DOI 10.1111/corg.12189

Corporate Governance: An International Review 2017;25:145. © 2017 John Wiley & Sons Ltdwileyonlinelibrary.com/journal/corg 145