Essays on equity finance and small firms

This thesis comprises three main empirical chapters, an Introduction and Conclusion. Chapter 2 analyses 903 firms that voluntarily delisted from the London Alternative Investment Market (AIM) to identify the factors affecting this delisting. The models are estimated using logit and propensity score matching is used to deal with endogeneity issues. It finds that the likelihood of voluntary delisting is positively related to firm size and growth opportunities, while it is negatively related with intangible assets and profitability levels. Chapter 3 examines firms' preferences for private equity versus public equity by analysing 261 equity crowdfunding offerings on Crowdcube versus 122 AIM offerings in the UK from 2013 to 2018. It concludes that firms with lower pre-money valuations and reduced equity offerings are more inclined towards equity crowdfunding. Moreover, companies with a lower proportion of stock issued and higher pre-money valuations have superior results in ECF campaigns. Chapter 4 analyses the performance of ECF campaigns on the unique angel crowdfunding platform, SyndicateRoom. Utilizing a sample of 130 campaigns on SyndicateRoom from 2013 to 2018, the analysis concludes that companies with more substantial fundraising goals attract more capital, and a higher level of equity offered increases individual investor participation. When comparing with financially comparable campaigns on the other platforms, campaigns on SyndicateRoom demonstrate worse performance regarding the likelihood of meeting fundraising goals and of the total capital raised. The last chapter presents a conclusion, delineates the constraints that observed throughout the research, and proposes prospective avenues for future studies.