Publications
Publications
- March 2017
- Strategic Management Journal
Entrepreneurial Beacons: The Yale Endowment, Run-ups, and the Growth of Venture Capital
By: Y. Sekou Bermiss, Benjamin J. Hallen, Rory McDonald and Emily Cox Pahnke
Abstract
This paper investigates the social context of entrepreneurship in organizational sectors. Prior research suggests that firm foundings are driven by collective patterns of activity—that is, by patterns of prior foundings—including support from related markets as well as institutional activism in a given sector. Building on research of social salience and signals, we consider the influence of singular sector-level triggers, which we call entrepreneurial beacons. We argue that the actions or outcomes of salient organizations attract and motivate entrepreneurs, thus increasing the rate of foundings. To test this logic, we examine the impact of the Yale University endowment's investment choices and of venture-capital-backed IPO run-ups on venture-capital foundings between 1984 and 2011. The results pinpoint the aspects of the social environment that most heavily influence entrepreneurial activity and the dynamics of organizational sectors.
Keywords
Signals; Social Salience; Venture Capital; Higher Education; Organizations; Entrepreneurship; Investment
Citation
Bermiss, Y. Sekou, Benjamin J. Hallen, Rory McDonald, and Emily Cox Pahnke. "Entrepreneurial Beacons: The Yale Endowment, Run-ups, and the Growth of Venture Capital." Strategic Management Journal 38, no. 3 (March 2017): 545–565.