Do Start-Ups Pay Less?

The authors analyze Danish registry data from 1991 to 2006 to determine how firm age and firm size influence wages. Unadjusted statistics suggest that smaller firms paid less than larger firms paid, and that firm age had little or no bearing on wages. After adjusting for differences in the characteristics of employees hired by these firms, however, they observe both firm age and firm size effects. Larger firms paid more than did smaller firms for observationally equivalent individuals but, contrary to conventional wisdom, younger firms paid more than older firms. The size effect, however, dominates the age effect. Thus, although the typical start-up — being both young and small — paid less than a more established employer, the largest start-ups paid a wage premium

Identification of Marketing Capabilities: A study on Indian product based B2B Telecom start-ups

New technology based start-ups play a very important role in developing the economy of a country. In India telecom sector has seen unprecedented growth over the decade and this has led to emergence of several telecom related start-ups. However, product based B2Bstart-ups are still rare and they have to undergo several challenges to stay afloat. Surprisingly not much research work has been undertaken in identifying capabilities among early stage start-ups although the early phase represents a very crucial phase for product based firms and in determines the success or failure for start-ups. Present study explores the inherent marketing capabilities that enable commercialization among such early stage start-ups by adopting a multiple case based inductive methodology with Indian telecom start-ups as our context. We have identified market orientation, positioning and segmentation, selling and after sales services as components of marketing capability of such start-ups. We also identify several idiosyncrasies among telecom start-ups vis-�-vis established firms in the sector. Fina lly we make a case for policy level intervention to promote telecom start-ups in the Indian context.

Entrepreneurship and innovation

This report provides an overview of recent facts and figures on start-ups in the Netherlands, techno start-ups in particular and the overall link between entrepreneurship and innovation.

Comparing Successful and Less Successful New Innovative Businesses

This contribution offers a conceptual framework for the analysis of innovative business start-ups. This framework mainly draws on transaction cost theory. On basis of a broad empirical study of 52 hightech business start-ups in Germany the fruitfulness of the transaction cost approach with respect to research on innovation is demonstrated. Transaction cost theory gives valuable hints for the interpretation of the personal role of the entrepreneur as well as for the economic evaluation of the entrepreneurial idea. Special importance refers to the results on the organization of market transactions as a decisive determinant of economic success of innovative business start-ups

How Does Personal Bankruptcy Law Affect Start-ups?

We analyze the effect of changes in U.S. state personal exemptions on the financing structure and performance of a representative sample of start-ups. An increase in the amount of borrower’s personal wealth protected in bankruptcy reduces the availability of bank credit to all start-ups. Owners of unlimited liability businesses, who benefit from the increase in wealth insurance, offset the reduction in bank credit by investing more money in the firm. We find no such response for start-ups whose entrepreneurs’ personal wealth is already protected by limited liability. Consequently, corporations experience lower growth rates and higher failure rates, while proprietorships performance is not negatively affected.Debtor protection;bankruptcy;start-ups;credit availability;agency problems

Determinants of Growth of Start-ups in the Netherlands

The dynamics and growth of firms are considered to be important for enhancing economic growth. Organizations can benefit from growth in many ways, including greater efficiency through economies of scale, increased power, the ability to withstand environmental change, increased profit and increased prestige for organizational members.It is important to obtain a better grip on the growth development of start-ups. The aim of this study is to map the development of start-ups in terms of employment growth and, in addition, to understand: what are the determinants of growth of start-ups?

Financing Start-ups: Advising vs. Competing

High-tech start-ups get external finance and guidance mostly from venture capitalists and/or business angels. We identify a simultaneous double moral hazard for the management style of entrepreneurs and the decision to advise the firm for financiers. We embed this relationship into the financial competition where strategic choices are equity shares, liquidation rights and quality of advising. We show that the financier holds all liquidation rights, that more competition weakly decreases the financier's equity share. Surprisingly, the response in advising quality is non-monotone. In a regime of soft competition, the financier owns the start-up and more competition weakens advising quality. In a regime of acute competition, more competition improves advising quality and lowers the financier's equity share in the start-up. Hence, advising and equity, are substitutes at the industry level once competition effects are taken into account.Start-ups, Contract Design, Equity, Oligopoly Competition

Does R&D-infrastructure attract high-tech start-ups?

Our research, based on the ZEW-Foundation Panel East, examines whether high-tech start-ups are mainly founded in scientific and infrastructural well suited regions or not. Estimation results on the level of postcode areas confirm the hypothesis that specific human capital, knowledge spillovers at higher-education institutions are more important for founding a firm in one of the high-tech sectors compared with the effects of other publicly financed institutions. The existence of large companies in the manufacturing sector has a considerable effect for start-up activities in this region in general. Moreover, high-tech start-ups are more concentrated within or near technology and foundation centres. --High Technology Industries,Eastern Germany,Start-ups,entrepreneurs

The impact of upper and lower echelon human capital and HR practices on innovation in start-ups.

Abstract Innovative start-ups have become the center of attention in government policy. They are considered to be the driving force of economic growth and international competitive advantage. Despite this growing interest, little is known about firm internal determinants of and critical success factors for innovation in newly established firms. Innovation is a function of a firm's ability to create, manage and maintain knowledge. Since knowledge is created by and stored within individuals, human resources as well as HR practices may play an important role as drivers of innovation in start-ups. We expect that start-ups having superior human resources (both owners/managers and employees) and an intensive HRM, are more able to innovate. Results show that unless employees' human capital is managed, it provides little benefit to start-ups in terms of innovation. Moreover, the impact of HRM intensity is higher in start-ups with high human capital as compared to newly established firms with low human capital. Next, innovation is indirectly (through the mediating effect of employees' human capital and/or HRM) and positively affected by the owners/managers' educational level and the appeal to certified experts. Industry experience, in turn, has an indirect negative impact. The number of independent board members directly and positively influences innovation.Employees; Human capital; Human resource management; Innovation; Startups;