{"title":"Big Tech platform acquisitions of start-ups and venture capital funding for innovation","authors":"Tiago S. Prado, Johannes M. Bauer","doi":"10.1016/j.infoecopol.2022.100973","DOIUrl":null,"url":null,"abstract":"<div><p>This paper investigates the effects of “Big Tech” platform acquisitions on venture capital (VC) funding for start-ups. We analyze 32,367 venture capital deals between 2010 and 2020, and 392 tech start-up acquisitions by Google, Facebook, Amazon, Apple, and Microsoft. Results obtained with fixed effects panel and differences-in-differences estimators reveal a positive, statistically significant, average effect of Big Tech start-up acquisitions on worldwide, venture capital activity. Positive effects were also found for the United States and Europe. However, the findings suggest that the effects are transient and fade away after several quarters. Because venture capitalists fund start-ups to enable entrepreneurial innovation, this approach also informs our understanding of the repercussions of these acquisitions on the start-up innovation ecosystem. The large number of observations over an extended period unlocks insights into historical patterns that are relevant for the design of digital platform policies.</p></div>","PeriodicalId":47029,"journal":{"name":"Information Economics and Policy","volume":"59 ","pages":"Article 100973"},"PeriodicalIF":4.5000,"publicationDate":"2022-06-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://www.sciencedirect.com/science/article/pii/S0167624522000129/pdfft?md5=42abac0dcec90ccfe5f23815e87bfa90&pid=1-s2.0-S0167624522000129-main.pdf","citationCount":"12","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Information Economics and Policy","FirstCategoryId":"96","ListUrlMain":"https://www.sciencedirect.com/science/article/pii/S0167624522000129","RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"ECONOMICS","Score":null,"Total":0}
引用次数: 12
Abstract
This paper investigates the effects of “Big Tech” platform acquisitions on venture capital (VC) funding for start-ups. We analyze 32,367 venture capital deals between 2010 and 2020, and 392 tech start-up acquisitions by Google, Facebook, Amazon, Apple, and Microsoft. Results obtained with fixed effects panel and differences-in-differences estimators reveal a positive, statistically significant, average effect of Big Tech start-up acquisitions on worldwide, venture capital activity. Positive effects were also found for the United States and Europe. However, the findings suggest that the effects are transient and fade away after several quarters. Because venture capitalists fund start-ups to enable entrepreneurial innovation, this approach also informs our understanding of the repercussions of these acquisitions on the start-up innovation ecosystem. The large number of observations over an extended period unlocks insights into historical patterns that are relevant for the design of digital platform policies.
期刊介绍：
IEP is an international journal that aims to publish peer-reviewed policy-oriented research about the production, distribution and use of information, including these subjects: the economics of the telecommunications, mass media, and other information industries, the economics of innovation and intellectual property, the role of information in economic development, and the role of information and information technology in the functioning of markets. The purpose of the journal is to provide an interdisciplinary and international forum for theoretical and empirical research that addresses the needs of other researchers, government, and professionals who are involved in the policy-making process. IEP publishes research papers, short contributions, and surveys.
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