Teodor Duevski

Ph. D. Candidate in Finance,  HEC Paris 

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Research interests:  corporate finance, private equity

Email: teodor.duevski@hec.edu

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Background:  I am a 4th year  Ph. D. Candidate in Finance at HEC Paris. My primary research interests are in corporate finance and financial intermediation in private markets. 

New: I am visiting Northwestern Kellogg in April - May 2024. 


Working papers:

Selected Presentations: Finance Theory Group Summer School , AFA (student poster session) , Rice - LEMMA Conference, HEC Paris,  Aalto University,  Entrepreneurship PhD Workshop

I study the determinants of  portfolio allocation decisions by venture capital (VC) firms. I construct a dynamic agency model with an exploration versus exploitation trade off of a VC firm raising capital for subsequent funds. The VC firm raises capital from a limited partner (LP) and can allocate this capital to a known industry (exploitation) or explore a new market (exploration). VC firms where the benefits of exploitation are high, optimally choose to exploit. VC firms that explore, and are able to raise a follow up fund, grow larger. In the presence of moral hazard the optimal contract offered by the LP involves a larger share of first fund's investments in the new market. Using data from Pitchbook I find evidence consisted with my model. Based on newly created VC firm's partners' past experience, I construct a novel opportunity cost of exploration measure and show that VC firms where the opportunity cost of exploration is high are more specialized and perform better at their first fund's investments. Conditional on raising a follow up fund however, they grow less. 

Media coverage: Insitutional Investor 

Selected Presentations: 7th Annual Private Markets Research Conference (scheduled), 3th Oxford Sustainable Private Market Conference (scheduled), International Risk Forum 

We present novel evidence on how ESG incidents affect the capital-raising ability of Private Equity (PE) firms. Using a sample of global buyout investments, we find that PE firms experiencing environmental and social (E&S) incidents in their portfolio companies are less likely to raise a subsequent fund and subsequent funds are smaller. The relative size of subsequent funds is 9%-12% smaller for PE firms experiencing above-median number of E&S incidents. The negative effect is stronger for less reputable PE firms. We do not find similar effects for governance (G) incidents. The decrease in capital commitment does not seem to be related to performance, instead it comes from departure of ESG-concerned limited partners with whom the PE firm had a past relationship. Following an incident, PE firms hire more employees with an ESG background and experience fewer incidents in their new investments.

Work in Progress:

Teaching:

Discussions:

Contributions to research:

In statistics, samples are drawn from a population in a data generating process (DGP). Standard errors measure the uncertainty in sample estimates of population parameters. In science, evidence is generated to test hypotheses in an evidence generating process (EGP). We claim that EGP variation across researchers adds uncertainty: non-standard errors. To study them, we let 164 teams test six hypotheses on the same sample. We find that non-standard errors are sizeable, on par with standard errors. Their size (i) co-varies only weakly with team merits, reproducibility, or peer rating, (ii) declines significantly after peer-feedback, and (iii) is underestimated by participants.

Pre - PhD Publications: