This project extends an existing database (1996-2008) of the educational and employment histories of the entire top management team and board of directors for firms making initial public stock offering to the period from 1988-1996. The ultimate database will include more that 3,500 newly public firms and 35,000 managers and directors providing career path information for these individuals. These individuals are a central channel by which investments in science and engineering (S&E) research are transformed into economic benefits. In this way, the project addresses one of the primary goals of the Science of Science and Innovation Policy, that of evaluating and tracking the tangible but difficult to measure returns from investments in R&D.
Intellectual Merit: The database permits exploration of many areas of inquiry regarding innovation and entrepreneurship. The immediate research examines the following topics: First, because the data is drawn from official biographies, it is possible to analyze the national origin and positions immigrants occupy in high-technology startups. This is a powerful contribution, because earlier research has only studied Indian and Chinese immigrants, the data allows the identification of immigrants and provides a rigorous definition rather than one based on extrapolation from surnames. This approach allows a more scientifically valid analysis. Second, the educational background allows the identification of particular universities and departments making inordinate contributions to specific high-technology industries. This can be used to identify key institutions and programs that might provide templates for wider adoption. Third, the new data can be used to examine the degree to which these most successful high-technology firms are located in regional clusters.
Broader Impacts. The creation of a comprehensive database of the individuals involved in initial public offerings has transformative potential. The key to the success of the U.S. economy during the last two decades has been S&E-based entrepreneurship. The analysis of this database contributes to academic studies of key human capital, and, as importantly, permits the optimization of S&E policy meant to encourage small business investment and entrepreneurship. The database is made available to all interested researchers, including business school scholars, economists, geographers, and sociologists. Research based on this database should expand our understanding of the individuals responsible for many of the most successful firms in the U.S. economy.
Project Description. This proposal expands an existing database (1996-2006) of initial public offerings (IPOs) on American stock markets back to include IPOs through 1990. All of the data collected in this project is derived from disclosure documents filed by firms with the SEC prior to their IPO. Prior to June 1996, when the SEC required that all filings by companies had to be online, these documents were only available at selected libraries. The SEC's online system to view documents is called the EDGAR was the basis of data collection of IPOs from mid-1996 through 2010. SEC filings prior to mid-1996 are not on EDGAR and can only be viewed at a few select libraries in a variety of formats. The current database of IPOs from 1990 through 2010 is composed of data on over 3,900 emerging growth firms. A related database of personnel of these firms is composed of over 44,000 firm managers and directors. Intellectual Merit. This proposal addresses the SCISIP goals of evaluating and tracking the tangible, but difficult to measure, returns from R&D investments. The database is now publicly accessible, and allows researchers and the public to explore many areas of inquiry including the characteristics of human capital in S&E-based industries, and the characteristics of high technology firms that have achieved a sufficient level of success to conduct an IPO. Broader Impacts. Sharing this database with researchers is one of the broader and transformative impacts of this project. It will be an input to a wide variety of research projects examining the management and directors for startups. The data users to date are business school scholars, economists, political scientists, legal scholars, business journalists, and other researchers. Numerous extensions are possible through linking the data to yet other databases. Research based on this database will expand our understanding of individuals that have created many of the most successful firms in the U.S. economy. Better understanding of the role of university education in career paths will permit policy-makers to optimize educations encouraging such entrepreneurship. Outcomes over the Life of the Project. 2010-2011: The IPO firm database was expanded to include the years 1996-2010, and was distributed freely to researchers on request. In July of 2011 Martin Kenney and Donald Patton completed a report for the Small Business Administration's Office of Advocacy, The Geography of Employment Growth: The Support Networks for Gazelle IPOs. 2012-2013: The IPO firm database was expanded to include the years 1990-2010 along with a companion database of all managers and directors of these firms. In 2012 Martin Kenney and Donald Patton, together with Professor Jay Ritter of the University of Florida, co-authored a report for the Kauffman Foundation. This report, Post-IPO Employment and Revenue Growth for U.S. IPOs, June 1996-2010, was well received, having been specifically referred to by Mark Hulbert in his MarketWatch.com commentary on the value of Facebook shares. Major Findings. The two reports that have emerged so far from this research effort explore somewhat different aspects of IPOs, with the SBA report focused on the employment of fast growing gazelles and IPO geography, while the Kauffman report examined both employment and revenue growth by distinguishing emerging growth IPOs from other IPOs. Among the highlights: most firm employment growth occurs in the first five years after going public, firms going public are remarkably concentrated geographically in California and Massachusetts, and growth among emerging growth firms varies greatly. Database Distribution. We have received over 100 database requests since the spring of 2010. Twenty five have identified themselves as PhD students, while another 14 are graduate students. Seventeen of those making requests identified themselves as faculty members, while a number of others were university research staff. Other requests came from a wide variety of institutions, including a market research firm, business accelerators, the Brookings Institution, and the World Bank, Most recently we have provided the data to FindTheBest.com, a venture backed Internet research hub, and from the National Economic Council, Executive Office of the President. Future Outreach Activities. Even though this project has come to an end we will continue with our outreach by providing our data to those who request it.
