Reynolds Holding

FEBRUARY 12, 2023

Founders may be reluctant to take on so much risk. Founders typically invest a large percentage of their human and financial capital into their startups and consequently are unable to diversify firm-specific risk. In our model, VCs address the divergence in risk preference by striking an implicit bargain with founders.

Finance 45

Finance Firm-specific Risk Equity Specific Risk 45

Reynolds Holding

JULY 5, 2022

Moreover, large companies typically have deep pockets, which ensures compensation for investors who incurred losses because they traded during the period when stock prices were distorted by false information. Sometimes they are represented on the board, which provides them with direct decision-making powers and access to information.

Firm-specific Risk 45

Firm-specific Risk Specific Risk Firm Value 45

Reynolds Holding

DECEMBER 22, 2024

Perhaps the family had private information about the value of the firm, but this presumably would have been elicited in the special committees scrutiny of the initial take-private offer. Controllers may limit managerial agency costs, but their self-interest produces so-called controlling shareholder agency costs. [2]

Dividends 45

Dividends Compliance Marketability Firm-specific Risk 45