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Why and How Do Family Firms Go Public?: A Socioemotional Wealth Perspective of IPO

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<mark>Journal publication date</mark>31/12/2024
<mark>Journal</mark>Family Business Review
Issue number4
Volume37
Number of pages31
Pages (from-to)400-430
Publication StatusPublished
Early online date17/09/24
<mark>Original language</mark>English

Abstract

This study investigates why and how family firms go public via initial public offering (IPO) and explores how family firms’ distinctive traits contribute to specific IPO behavior. The results show that family firms face IPO following three paths— shine, continue, and challenge. Family IPO firms emphasize control, identification, and succession ( shine); focus on family social capital, responsibility toward stakeholders, and family business identity ( continue); and highlight control, identification, new leaders’ self-affirmation, and generational transfers ( challenge). We uncover the complexities of emotional endowment—a reference point for making IPO decisions and a resource or constraint to engage in the IPO process.