Financial accounting, venture capital, private equity, financial reporting, corporate governance
Home Faculty and Research Wan Wongsunwai
Wan Wongsunwai
ACCOUNTING INFORMATION & MANAGEMENT
Assistant Professor of Accounting Information & Management
Lawrence Revsine Research Professorship in Accounting Information & Management
Wan Wongsunwai is an Assistant Professor and Lawrence Revsine Research Professor in the Accounting Information and Management department. His research interests include financial reporting quality, corporate governance, entrepreneurship and private equity. Wan received his Doctor of Business Administration degree from Harvard Business School. Prior to obtaining his doctoral degree and joining Kellogg, Wan worked as a financial analyst with ABN AMRO Bank, and he was ranked by Reuters as one of the Top 10 analysts in Hong Kong and China covering software and information technology. Prior to that, he was a senior manager with PricewaterhouseCoopers in Hong Kong, where he had responsibility for professional staff recruitment, training, deployment, and promotion, and where he also managed his own portfolio of audit and due diligence clients.
Entrepreneurship
Financial Accounting
Financial Reporting
Security Analysis
Small Business Management
Venture Capital and Private Equity
Areas of Expertise
Corporate GovernanceEntrepreneurship
Financial Accounting
Financial Reporting
Security Analysis
Small Business Management
Venture Capital and Private Equity
Education
DBA, 2007, Business Administration, Harvard UniversityACA, 1993, Institute of Chartered Accountants in England and WalesBS, 1990, Mathematics, Imperial College of Science, Technology, and Medicine, First Class Honors
Academic Positions
Assistant Professor, Accounting Information & Management, Kellogg School of Management, Northwestern University, 2007-presentResearch Interests
Articles
Lerner, Josh, Antoinette Schoar and Wan Wongsunwai. 2007. Smart Institutions, Foolish Choices: The Limited Partner Performance Puzzle. Journal of Finance. 62(2): 731-764.
The returns that institutional investors realize from private equity investments differ dramatically across institutions. Using detailed and hitherto unexplored records of fund investors and performance, we document large heterogeneity in the performance of different classes of limited partners. In particular, endowments’ annual returns are nearly 21% greater than average. Funds selected by banks lag sharply. Analysis of reinvestment decisions suggests that endowments (and to a lesser extent, public pension funds) are better than other investors at predicting whether a follow-on fund will have high returns. We find that the results are not primarily due to endowments’ greater access to established funds, since they also hold for young or under-subscribed funds. Our results suggest that limited partners vary in their level of sophistication and also their objectives.
The returns that institutional investors realize from private equity investments differ dramatically across institutions. Using detailed and hitherto unexplored records of fund investors and performance, we document large heterogeneity in the performance of different classes of limited partners. In particular, endowments’ annual returns are nearly 21% greater than average. Funds selected by banks lag sharply. Analysis of reinvestment decisions suggests that endowments (and to a lesser extent, public pension funds) are better than other investors at predicting whether a follow-on fund will have high returns. We find that the results are not primarily due to endowments’ greater access to established funds, since they also hold for young or under-subscribed funds. Our results suggest that limited partners vary in their level of sophistication and also their objectives.
Working Papers
Wongsunwai, Wan. 2008. Does Venture Capitalist Quality Affect Corporate Governance?.
This paper investigates the effect of venture capitalist (VC) quality on the corporate governance of portfolio companies, focusing on board characteristics and financial reporting quality. I develop a new metric to measure VC quality, using data that are obtainable for virtually all VC firms. This metric is highly correlated with VC funds' financial returns, and with the likelihood of successful exits through initial public offerings or trade sales. Companies backed by higher quality VCs have larger, more independent boards of directors, and have increased VC presence on the board, even after controlling for endogeneity. After going public, companies backed by higher quality VCs have lower abnormal accruals and a lower likelihood of financial restatement. Overall, the results suggest that higher quality VCs help establish better governance at companies in which they invest.
This paper investigates the effect of venture capitalist (VC) quality on the corporate governance of portfolio companies, focusing on board characteristics and financial reporting quality. I develop a new metric to measure VC quality, using data that are obtainable for virtually all VC firms. This metric is highly correlated with VC funds' financial returns, and with the likelihood of successful exits through initial public offerings or trade sales. Companies backed by higher quality VCs have larger, more independent boards of directors, and have increased VC presence on the board, even after controlling for endogeneity. After going public, companies backed by higher quality VCs have lower abnormal accruals and a lower likelihood of financial restatement. Overall, the results suggest that higher quality VCs help establish better governance at companies in which they invest.
Cases
Wongsunwai, Wan. 2004. George McClelland at KSR (A), (B), (C ) Teaching Note. Boston: HBS Publishing, Case 5-404-111.
Wongsunwai, Wan. 2003. George McClelland at KSR (A). Boston: HBS Publishing, Case 9-403-163.
Teaching Interests
Financial accountingFull-Time / Part-Time MBA
Financial Reporting and Analysis (ACCT-451-0)This course counts toward the following majors: Accounting
This course provides a study of current practices in corporate financial reporting and fundamental issues relating to asset valuation and income determination. The emphasis is on financial statement analysis and interpretation of existing financial disclosures. The course stresses critical analyses of financial reporting numbers as a basis for improved risk assessment and cash flow forecasting. Cases are used extensively to enhance relevance.
Prerequisite: A grade of C or better in ACCT-430.
CONTACT INFO:
PHONE: 847-491-2658
FAX: 847-467-1202
PHONE: 847-491-2658
FAX: 847-467-1202
OFFICE:
Jacobs Center Room 6229
Jacobs Center Room 6229