Business, Management and Accounting
8 years ago

Investors struggle to value intangible assets in high-tech ventures.

Why is it so hard to value intangibles
Gavin Reid, Julia Smith

Paper Summary

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The article explores why it's difficult to put a value on intangible assets in high-tech companies. Venture capitalists, who are experts in risk and finance, invest in these companies, but the entrepreneurs know more about the products. This can lead to problems like information gaps and risks. To solve this, investors use expert research and monitoring to assess the value of these intangible assets. The study shows that both investors and entrepreneurs use a mix of skills and knowledge to make investment decisions in high-tech ventures.