Entry and innovation. An analysis of the fabless semiconductor business

The relationship between pre-entry experience
and patenting for a sample of 133 firms active
in the fabless semiconductor business between 1984
and 2005 is studied. Controlling for variables such as
venture capital, post-entry experience and parent
involvement in the creation of the new venture, it is
found that firms with better educated founders have a
higher hazard to patent soon after entry. Additionally,
firms whose founders have a longer tenure in the
parent firm have a relatively higher hazard of
patenting. Finally, firms whose founders have innovated
in the past are more likely to innovate. Results
suggest that both general and specific human capital
are important preconditions of pre-entry experience.