Productivity Growth in Private–Equity–Backed Family Firms

  1. Croce, Annalisa 1
  2. Martí, José 2
  1. 1 Dipartimento di Ingegneria Gestionale, Politecnico di Milano, Milan, Lombardia, Italy.
  2. 2 Department of Financial Economics and Accounting III, Facultad de CC. EE. y EE. Edificio 6, University Complutense of Madrid, Pozuelo de Alarcón, Madrid, Spain.
Revista:
Entrepreneurship Theory and Practice

ISSN: 1042-2587,  1540-6520

Ano de publicación: 2016

Volume: 40

Número: 3

Páxinas: 657-683

Tipo: Artigo

DOI: 10.1111/ETAP.12138 GOOGLE SCHOLAR lock_openAcceso aberto editor

Outras publicacións en: Entrepreneurship Theory and Practice

Obxectivos de Desenvolvemento Sustentable

Resumo

We study the reluctance of family firms to accept private equity (PE) investors and the impact of PE on family firms' performance. We analyze the productivity growth in a sample of 257 PE-backed family firms, 143 of which were run by the founding generation. We compare these firms with both non-PE-backed family firms and non family PE-backed firms. We find that family firms accessing PE show lower productivity growth before the initial PE round, which is driven by an imbalance between inputs and output, especially in founder-controlled firms. Our results also confirm the positive impact of PE involvement on productivity growth in founder-controlled firms.