Search
Feedback
About UniCat 
Help
News
| Listing 1 - 3 of 3 |
Sort by
|
Book
Year: 2019 Publisher: Cambridge, Mass. National Bureau of Economic Research
Abstract | Keywords | Export | Availability | Bookmark
Loading...Choose an application
- Reference Manager
- EndNote
- RefWorks (Direct export to RefWorks)
The majority of IPOs and acquisitions are achieved without venture capital financing, yet research has focused mostly on VC backed firms. Using founding choices and a predictive analytics approach on virtually all US registered businesses, we shed light into these "missing" growth firms. Founding choices that predict raising venture capital also strongly predict equity exits without VC. Firms with growth potential are similar to each other, irrespective of funding source. Moreover, matching firms that are born with identical observables, but only differ in whether they receive venture capital, suggests an upper bound to the returns to venture capital of 600%.
Book
Year: 2019 Publisher: Cambridge, Mass. National Bureau of Economic Research
Abstract | Keywords | Export | Availability | Bookmark
Loading...Choose an application
- Reference Manager
- EndNote
- RefWorks (Direct export to RefWorks)
This paper develops a novel approach for assessing the role of passive learning versus a proactive growth orientation in the entrepreneurial growth process. We develop a simple model linking early-stage founder choices, venture capital investment and skewed growth outcomes such as the achievement of an IPO or significant acquisition. Using comprehensive business registration data from 34 US states from 1995-2004, we observe that firms that register in Delaware or obtain intellectual property such as a patent or trademark are far more likely to ultimately realize significant equity growth, and these choices also predict early-stage venture capital investment. Moreover, the estimated probability of receiving venture capital as reflected in early-stage founder choices predicts growth even for firms that do not receive venture capital. We use these findings to estimate bounds on the fraction of proactive versus passive firms among firms that ultimately achieve significant equity growth. While nearly half of all firms that achieve modest equity growth (> $10M) are consistent with passive learning (as they neither make early-stage founder choices nor receive venture capital), 78% of firms experiencing an equity growth event greater than $100M are associated with active founder choices and/or venture capital investment, and these firms are concentrated in geographic hubs such as Silicon Valley. Finally, our approach offers a novel approach for estimating the private returns to venture capital, matching on founder choices rather than demographics; consistent with prior studies, venture-backed firms are approximately 5X more likely to grow, with heterogeneity across location and time period.
Book
Year: 2019 Publisher: Cambridge, Mass. National Bureau of Economic Research
Abstract | Keywords | Export | Availability | Bookmark
Loading...Choose an application
- Reference Manager
- EndNote
- RefWorks (Direct export to RefWorks)
The acceleration of start-up activity is often cited as a rationale for the R&D tax credit, a key innovation policy instrument adopted increasingly by US states over the past quarter century. While there is a strong empirical base linking the R&D tax credit to increased R&D expenditures and innovation, prior work has not provided causal evidence that this policy effects the rate of formation and growth potential of new businesses. This paper combines data from the US Startup Cartography Project with the Panel Database on Incentives and Taxes to implement a difference-in-differences estimate of the impact of the R&D tax credit on the quantity and quality-adjusted quantity of entrepreneurship. Our key finding is that the R&D tax credit is associated with a significant long-term impact on both the overall quantity and quality-adjusted quantity of entrepreneurship, with the bulk of the effect materializing more than five years after the policy is enacted. These findings stand in contrast to an analysis of the adoption of state-level investment tax credits. There, we observe no long-term impact on the quantity of entrepreneurship but a marked decline in the rate of formation of growth-oriented startups over time. Combined with other evidence regarding the efficacy of R&D tax credits in spurring innovative investment, our results shed light on the potential for this fiscal policy to also stimulate the formation of growth-oriented start-ups.
| Listing 1 - 3 of 3 |
Sort by
|