Should the ‘Jockey’ Come Before the ‘Horse’?
Research suggests that VCs may have a tendency to place too much weight on founding teams.
{PubDate}
Biography
Steve Kaplan conducts research on private equity, venture capital, entrepreneurial finance, corporate governance and corporate finance. He has published papers in a number of academic and business journals. He was elected to the Society of Fellows of the American Finance Association in 2025 in recognition of distinguished contributions to the field of finance.
He is the co-creator of the Kaplan-Schoar PME (Public Market Equivalent) private equity benchmarking approach. A Fortune Magazine article referred to him as "probably the foremost private equity scholar in the galaxy.”
Kaplan teaches advanced MBA and executive courses in entrepreneurial finance and private equity, corporate finance, corporate governance, and wealth management. BusinessWeek named him one of the top 12 business school teachers in the country.
Professor Kaplan co-founded the entrepreneurship program at Booth. With his students, he helped start Booth’s business plan competition, the New Venture Challenge (NVC), which has included over 800 companies that have raised over $1.5 billion and created over $10 billion in value including GrubHub, Braintree/Venmo, Tovala and Simple Mills.
Kaplan serves on the board of Morningstar and several fund and company advisory boards. He has been a member of the faculty since 1988.
He received his AB, summa cum laude, in Applied Mathematics and Economics from Harvard College and earned a PhD in Business Economics from Harvard University.
Research Interests
Private equity; venture capital; corporate governance; boards of directors; mergers and acquisitions; corporate finance.
Academic Areas
- Entrepreneurship
- Finance
Selected Publications
with Morten Sorensen, "Are CEOs Different? Characteristics of Top Managers." Journal of Finance, forthcoming.
with Gregory W. Brown, Robert S. Harris, Wendy Hu, Tim Jenkinson and David Robinson, "Can Investors Time Their Exposure to Private Equity?" Journal of Financial Economics, forthcoming.
with Paul Gompers, Will Gornall and Ilya Strebulaev, "How Do Venture Capitalists Make Decisions?" Journal of Financial Economics, (2020), Volume 135, 169-190.
with Greg Brown and Oleg Gredil, "Do Private Equity Funds Manipulate Returns?" Journal of Financial Economics, (2019), Volume 132, 267-297. (Lead article).
with Robert S. Harris, Tim Jenkinson and Ruediger Stucke, "Financial Intermediation in Private Equity: How Well Do Funds of Funds Perform?" Journal of Financial Economics, (2018), Volume 129, 287–305.
with Paul Gompers and Vladimir Mukharlyamov, "What Do Private Equity Firms (Say They) Do?" Journal of Financial Economics, (2016), Volume 121, 449-476.(Lead article).
with Robert S. Harris and Tim Jenkinson, "How Do Private Equity Investments Perform Compared to Public Equity?" Journal of Investment Management, (2016), Volume 14, 1-24.(Markowitz Award Prize for the best paper published in the JOIM for 2016).
with Berk Sensoy, “Private Equity Performance: A Survey,” Annual Review of Financial Economics, December 2015, Volume 7,597–614.
with Robert Harris and Tim Jenkinson, "Private Equity Performance: What Do We Know?" Journal of Finance, October 2014, 1851-1882.(Lead article).
with Tobias Moskowitz and Berk Sensoy, "The Effects of Stock Lending on Security Prices: An Experiment" Journal of Finance, October 2013, 1891-1936.
with Josh Rauh, "It’s the Market: The Broad-Based Rise in the Return to Top Talent," Journal of Economic Perspectives, Summer 2013, 35-5.
with Joshua Rauh, "Family, Education, andSources of Wealth Among the Richest Americans, 1982-2012," American Economic Review: Papers and Proceedings, 2013, 158-162
"Executive Compensation and Corporate Governance in the U.S.: Perceptions, Facts and Challenges," Cato Papers on Public Policy, Volume 2, 2012, 99 –157.
with Mark Klebanov and Morten Sorensen, "Which CEO Characteristics and Abilities Matter?" Journal of Finance, June 2012, 973-1007.
with Bernadette Minton, "How has CEO Turnover Changed? Increasingly Performance Sensitive Boards and Increasingly Uneasy CEOs", International Review of Finance, March 2012, 57–87.
with Josh Rauh, "Wall Street and Main Street: What Contributes to the Rise in the Highest Incomes?" Review of Financial Studies, March 2010 (23), 1004-1050.
with Berk Sensoy and Per Strömberg, "Should Investors Bet on the Jockey or the Horse? Evidence from the Evolution of Firms from Early Business Plans to Public Companies," Journal of Finance, February 2009 (64), 75-115.
"Leveraged Buyouts and Private Equity" with Per Strömberg, Journal of Economic Perspectives, Winter 2009, 121-146.
"Are U.S. CEOs Overpaid?", Academy of Management Perspectives, May (2008).
"How Do Legal Differences and Learning Affect Financial Contracts?" with Fredric Martel and Per Strömberg, Journal of Financial Intermediation, Volume 16, July 2007, 273-311. Best paper in Journal of Financial Intermediation in 2007.
"Private Equity Performance: Returns, Persistence and Capital Flows," with Antoinette Schoar, Journal of Finance, Volume 60, August 2005.
"Characteristics, Contracts, and Actions: Evidence From Venture Capitalist Analyses," with Per Strömberg. Journal of Finance, Volume 59, October 2004, 2177-2210.
"What is the Price of Hubris? Using Takeover Battles to Infer Overpayments and Synergies," with Pekka Hietala and David T. Robinson, Financial Management, Volume 32, Number 3, Autumn, 2003. Awarded Addison-Wesley Prize for 2nd Best Paper in Autumn, 2002 to Summer, 2004 issues.
"The State of U.S. Corporate Governance: What’s Right and What’s Wrong?"(with BengtHolmstrom), Journal of Applied Corporate Finance, Spring 2003, 8-20.
"Financial Contracting Theory Meets the Real World:Evidence From Venture Capital Contracts," with Per Strömberg, Review of Economic Studies, Volume 70, April 2003, 281-316.
with Luis Garicano, "The Effects of Business-to-Business E-Commerce on Transaction Costs", Journal of Industrial Economics, (2001).
with Bengt Holmstrom, "Corporate Governance and Merger Activity in the U.S", Journal of Economic Perspectives, Spring (2001).
Venture Capitalists As Principals: Contracting, Screening, and Monitoring," with Per Strömberg, American Economic Review:Papers and Proceedings, Volume 91, May, 2001, 426-430.
with Mohanbir Sawhney, "B2B E-Commerce Hubs: Towards a Taxonomy of Business Models," Harvard Business Review, (2000).
with Luigi Zingales, "Investment-Cash Flow Sensitivities Are Not Valid Measures of Financing Constraints," Quarterly Journal of Economics, May, (2000), 707-712.
"A Clinical Exploration of Value Creation and Destruction in Acquisitions: Integration, Organization Design, and Internal Capital Markets," with Mark Mitchell and Karen Wruck, in Mergers and Productivity, Steven Kaplan, editor, National Bureau of Economic Research, 2000
"How Costly is Financial (not Economic) Distress? Evidence from Highly Leveraged Transactions that Became Distressed," with Gregor Andrade, Journal of Finance 53, October, 1998, 1443-1494. (Lead article).
Awarded Smith Breeden Prize for First Prize Paper in 1998.
"The Evolution of U.S. Corporate Governance: We Are All Henry Kravis Now," Journal of Private Equity, Fall, 1997, 7-14.
"Do Financing Constraints Explain Why Investment Is CorrelatedWithCash Flow?" with Luigi Zingales, Quarterly Journal of Economics, Volume 112, February, 1997, 169-215.
"The Valuation of Cash Flow Forecasts," with Richard Ruback, Journal of Finance, Volume 50, September, 1995, 1059-1094.
"Appointments of Outsiders to Japanese Boards: Determinants and Implications for Managers," with Bernadette Minton, Journal of Financial Economics, Volume 36, October, 1994, 225-258.
"Top Executive Rewards and Firm Performance: A Comparison of Japan andthe U.S.," Journal of Political Economy, Volume 102, June, 1994, 510-546.
"Top Executives, Turnover, and Firm Performance in Germany," Journal of Law, Economics, & Organization, Volume 10, April, 1994, 142-159.
"Campeau's Acquisition of Federated: Post-Bankruptcy Results," Journal of Financial Economics, Volume 35, February, 1994, 123-136.
"The Evolution of Buyout Pricing and Financial Structure in the 1980s," with Jeremy Stein, Quarterly Journal of Economics, Volume 108, May, 1993, 313-358.
"The Success of Acquisitions: Evidence from Divestitures," with Michael Weisbach, Journal of Finance, Volume 47, March, 1992, 107-138.
"The Staying Power of Leveraged Buyouts," Journal of Financial Economics, Volume 29, October, 1991, 287-314.
"How Risky is the Debt in Highly Leveraged Transactions?" with Jeremy Stein, Journal of Financial Economics, Volume 27, October, 1990, 215-246.
"Outside Directorships and Corporate Performance," with David Reishus, Journal of Financial Economics, Volume 27, October, 1990, 389-410.
"Campeau's Acquisition of Federated: Value Destroyed or Value Added?" Journal of Financial Economics, Volume 25, December, 1989, 191-212. Reprinted in Financial Statement Analysisedited by Ray Ball and S. P. Kothari (New York: McGraw-Hill, 1994).
"The Effects of Management Buyouts on Operating Performance and Value," Journal of Financial Economics, Volume 24, October, 1989, 217-254. Reprinted in Financial Statement Analysiseds., Ray Ball and S. P. Kothari (New York: McGraw-Hill, 1994).
Reprinted in Empirical Issues in Raising Equity Capital ed. Mario Levis (London: North Holland 1995).
"Management Buyouts: Evidence on Taxes as a Source of Value," Journal of Finance, Volume 44, July, 1989, 611-632.
"The Effects of LBOs on Tax Revenues," with Michael Jensen and Laura Stiglin, Tax Notes, Volume 42, February 6, 1989. Reprinted in The High Yield Debt Marketed. Edward Altman (Illinois: Dow Jones-Irwin, 1990).
For a listing of research publications, please visit the university library listing page.
Working Papers
2025 - 2026 Course Schedule
Get Insights from Steven Neil Kaplan in Chicago Booth Review
What Investors Look for in a Startup Pitch
Chicago Booth’s Steve Kaplan explains what he has learned from surveying venture capitalists.
{PubDate}
Decoding the Signals in Private Equity Reports
How can investors get a better sense of how big their returns will be, and when they will see them?
{PubDate}