New York-area Georgetown McDonough alumni participated in a thought-provoking discussion of “Capital Formation and Job Creation,” during a February 22, 2012, event at The Princeton Club. The panel discussion was hosted by Georgetown University’s McDonough School of Business Office of External Affairs and Alumni Relations and the Georgetown Center for Financial Markets and Policy.
Panelist included Reena Aggarwal, Robert E. McDonough Professor Finance and director of the Center for Financial Markets
; Kathleen L. Casey, former commissioner, U.S. Securities and Exchange Commission; Mario J. Gabelli, chairman and chief executive officer, GAMCO Investors, Inc.; and Laurence A. Tosi (C ’90, JD ’94, MBA ’94), senior managing director and chief financial officer, The Blackstone Group. Telis Demos, U.S. Equity Markets report at The Financial Times, moderated the discussion, which centered the role of capital formation and job creation, trends in U.S. public markets, and the role of private equity.
Aggarwal answered the first question of the evening by highlighting important statistics about the changes in capital formation.
“Ninety percent of job creation for public firms tends to take place just after a firm has done an IPO. Firms like Microsoft, and now Facebook that recently filed an IPO, represent entrepreneurship and innovation. They bring about job growth,” she said.
However, she also noted statistics that show the potential for a “lost decade” for the U.S. market. “Since 2000, it has become difficult for companies to raise capital,” she said. “The number of IPOs every year since 1997 is less than the number of companies leaving our stock exchanges.”
Casey examined the decline of IPOs from the perspective of the SEC, identifying the issues and the confluence of events that make it difficult for smaller cap companies to raise capital.
Gabelli and Tosi broadened the discussion to the global markets and alternatives, such as private markets. Both executives have managed companies that have gone public. They identified and debated the opportunities for entrepreneurs and companies to raise capital and create jobs.
The Georgetown Center of Financial Markets and Policy hosts dialogues, conference, and events throughout the year to provide innovative solutions to important policy issues related to global financial markets. For more information, visit http://finpolicy.georgetown.edu