Finance Seminar: Professor Michelle Lowry
Mutual Fund Investments in Private Firms
Historically a key advantage of being a public firm was broader access to capital, from a disperse group of shareholders. In recent years, such capital has increasingly become available to private firms as well. We document a dramatic increase over the past twenty years in the number of mutual funds participating in private markets and in the dollar value of these private firm investments. On the demand side, the greater availability of capital changes the trade-off between private and public listing status: mutual fund investments enable companies to stay private an average one to two years longer. On the supply side, mutual funds’ returns on these investments are both economically meaningful and beneficial as a source of diversification, relative to investments in publicly traded firms.
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Michelle is the TD Bank Professor of Finance at the LeBow School of Business, Drexel University. She received her PhD from the University of Rochester, and was previously a professor at Penn State University. In addition, she is a past visiting professor at INSEAD and at the Wharton School. She is an associate editor of the Journal of Financial Economics, a past associate editor of the Review of Financial Studies, and an academic director at the Corporate Governance Center at Drexel University. She is a founding member of AFFECT (Academic Female Finance Committee), which strives for gender equality among the field of finance academics. Her research focuses on a variety of issues in empirical corporate finance, including initial public offerings, mergers, and corporate governance. She is particularly interested in the ways that companies’ corporate governance affects their performance around these corporate events. Her research has been published in top finance journals, including the Journal of Financial Economics, the Review of Financial Studies, and the Journal of Finance. Her research also relates to the effects of policy on firm outcomes, in particular regulation related to firm governance and shareholder voting. In this vein, she recently participated in an SEC panel on shareholder voting. Finally, her research has also attracted attention in the popular press, with cites in the Wall Street Journal, USA Today, NPR's Morning Edition, and Forbes.