Roman Inderst (Goethe University Frankfurt) presenting 'Preserving 'Debt Capacity' or 'Equity Capacity': A Dynamic Theory of Security Design under Asymmetric Information', a paper that shows in a dynamic model of optimal security design when firms should preserve equity capacity through high leverage or debt capacity through initial low leverage. Thereby, firms reduce a problem of either underinvestment or overinvestment when they must raise financing under asymmetric information, probably at short notice. Which problem arises most likely depends on whether firms can expect to raise additional financing at competitive terms even under asymmetric nformation or whether they will be locked-in with initial (relationship) investors. Firms initial (or target) capital structure matters as it affects the outside options of both insiders and investors. The theory also entails mplications for start-up and venture capital financing.