Private Equity and Capital Market Research Proposal

Hypothesis

Within the context of the current study, there are several proposed hypotheses. First, the study will aim to prove that the private equity market in Austria is underdeveloped. Second, this is caused primarily a cultural phenomenon based on attitudes towards the capital market, especially private equity. Additionally, it looks at how the SME segment is important within the Austrian economy and that a boost in private equity would then be beneficial to this market.

Methods and Procedures

The context of the study will be broken into two main parts. The first will be an empirical study of the capital market development in Austria. This will provide exploration of the key players and their role in the Austrian capital market with references to International comparison and benchmark. This will include a thorough literature review regarding the SME structure in Austria, including information on what the typical ownership structure is.

The second part will be a qualitative study of a select group of CEO/CFO and company owners. It will incorporate a minimum of at least twenty interviews, with the individuals selected in order to secure opinions from professionals and major industry players. The survey sample will include representatives from large, medium, and small company representatives.Within the survey will be questions regarding economic activity and outlook, their individual view of the capital market and its influence on their business, investor protection and corporate governance, human and social environment, how they traditionally finance business, impact of the current recession, their individual view and understanding of private equity, potential barriers to private equity, and what could be done to increase availability of private equity within the region. These can then be compiled to provide a comprehensive view of the current situation as well as to provide potential strategies for increasing private equity within Austria.

Significance of the Study

With a large number of small to medium sized private firms in Austria, securing more increased levels of private equity within the country would help find more business development opportunities which would dramatically increase the potential for growth within the region. Additionally, increasing private equity in Austria can provide more leveraging room for SME businesses that may face a change of ownership in the near future. Increasing private equity could then serve as a relevant candidate as finance and equity partner in the event of a Management Buy Out (MBO) or Management Buy In (MBI)......