In the past few years Internet-based investment banks have emerged that provide companies with another sales channel for selling their stock through initial public offerings (IPOs). In this study we address two research issues related to these new intermediaries. First, what are the characteristics of firms that choose online (Internet-based) investment banks to distribute some portion of their IPO (Internet IPOs) as opposed to choosing entirely traditional distribution methods? And second, what are the characteristics of the issues themselves? Using data from 27 IPOs issued between 16 July 1998 and 14 December 1998 we find that Internet IPOs are significantly larger in terms of market value than firms choosing traditional distribution venues. The Internet IPOs also employ more reputable investment banks to manage their IPO and their CEOs were significantly younger. Overall, we find that Internet and traditional IPOs have more similarities than differences. These findings have implications for investment ...
['Troy J. Strader', 'Richard B. Carter', 'Sree Nilakanta']
Characteristics of Initial Public Offerings (IPOs) Issued through Internet-Based Investment Banks