Entrepreneurship and the growth of regional clusters are intimately related, but entrepreneurship does not occur in a vacuum. The entrepreneur must mobilize people, organizations, markets, and resources to support their fledgling venture. Several of these actors, such as law firms and venture capitalists, together with others, comprise a firm's entrepreneurial support network. Despite the recognition of the importance of these actors, there has been little research on their location. There has been an assumption that these supporting actors should be located in close proximity to the entrepreneurs. More recently, some spatial scientists have remarked that even highly clustered industries characterized internally by "local buzz" have "global pipelines" to actors outside the cluster. This research project will test the assumption of proximity to determine its validity across industries and regions. The project will draw upon a database of the approximately 2,400 firms that went public between 1996 and 2006 in the United States. These data provide the exact locations of the startup firm and its lawyer, venture capitalists, other members of its board of directors, and its lead investment banker -- all key contributors to the birth, growth, and maturation of an entrepreneurial firm. Chi square analysis will be used primarily for statistically testable propositions based on nominal level data regarding the proximity of startup firms and members of their entrepreneurial support network, while a hazard model will be used to examine the spatial influences on the speed with which startups go public.
This project will extend previous technology firm-centric research to these largely neglected entrepreneurial firms, thereby offering new insight into whether these industries and their entrepreneurial support networks exhibit clustering. For practitioners interested in regional economic development, the results will suggest industries within which successful entrepreneurial firms can be created despite a scarcity of local support actors. This is particularly important for regions not as richly endowed with venture capital and other support network actors. The project also will make available, via a website, the database with its numerous variables of geographic interest to other scholars. This will permit other researchers to build and extend this project with strict data compatibility.
