How anticipated employee mobility affects acquisition likelihood: Evidence from a natural experiment

Younge, Kenneth; Tong, Tony W.; Fleming, Lee

doi:10.1002/smj.2237

Cited by 99 publications

(69 citation statements)

References 104 publications

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“…For managers, our results highlight challenges that established firms may face when seeking to “acqui‐hire” human capital by buying innovative start‐ups (Selby & Mayer, ; Younge, Tong, & Fleming, ). If the resulting integration changes job attributes toward those typical of established firms, employees who initially joined a start‐up because they valued the entrepreneurial environment may soon become disenfranchised and seek to leave.…”

Section: Summary and Discussionsupporting

confidence: 89%

Fire in the belly? Employee motives and innovative performance in start‐ups versus established firms

Sauermann

2017

Strategic Entrepreneurship

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Research Summary: We examine whether start‐ups attract employees with different pecuniary and non‐pecuniary motives than small or large established firms. We then explore whether such differences in employee motives may lead to differences in innovative performance across firm types. Using data on more than 10,000 U.S. R&D employees, we find that start‐up employees (“joiners”) place lower importance on job security and salary but greater importance on independence and responsibility. Start‐up employees have higher patent output than employees in small and large established firms, and this difference is partly mediated by employee motives—especially joiners’ greater willingness to bear risk. We discuss implications for research as well as for managers and policy makers concerned with the supply of human capital to entrepreneurship and innovation. Managerial Summary: Start‐ups and established firms play different roles in the economy and differ with respect to their organizational features. Recent research has started to also explore differences in their human capital. While prior work focuses on employees’ skills and experience, we broaden the notion of human capital to include motivational characteristics. We find that start‐up employees differ from those working in established firms with respect to their motives, most notably a weaker concern with job security. Moreover, such differences can partly explain higher innovative performance in start‐ups. Our findings suggest that founders may derive significant benefits from hiring “joiners” with entrepreneurial motives. Our findings also have implications for corporate managers who seek to acquire start‐ups or who consider creating entrepreneurial units that replicate features of young and small organizations.

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Section: Summary and Discussionsupporting

confidence: 89%

Fire in the belly? Employee motives and innovative performance in start‐ups versus established firms

Sauermann

2017

Strategic Entrepreneurship

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“…Garmaise (2011) uses noncompete policy adjustments to show that firms pay executives less when they can restrict extraorganizational opportunities via noncompetes. Younge et al (2015) find that public firms are more likely to be acquired when noncompetes are enforceable, presumably because more value of the workforce can be retained postacquisition. Starr (2014) suggests that firm-sponsored training is more common in litigious occupations when enforcement is stronger.…”

Section: Employee Noncompete Agreementsmentioning

confidence: 92%

“…Younge et al. () find that public firms are more likely to be acquired when noncompetes are enforceable, presumably because more value of the workforce can be retained postacquisition. Starr () suggests that firm‐sponsored training is more common in litigious occupations when enforcement is stronger.…”

Section: The Impact Of Employee Departurementioning

confidence: 99%

The Value of Employee Retention: Evidence From a Natural Experiment

Younge

Marx

2015

Economics Manag Strategy

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“…Thus, important questions remain unanswered, such as how power and politics affect decisionmaking processes within the acquirer and shape bonding and trust within and across the merging firms (e.g., Graebner, 2009). Moreover, given that employee exit affects PMI performance (e.g., Krishnan, Hitt, & Park, 2007) Younge, Tong, & Fleming, 2015, it would be fruitful to examine how power and politics influence the appointment of staff to key positions, shaping retention and decision-making across the combined organization.…”

Section: Decision-makingmentioning

confidence: 99%

The Process of Postmerger Integration: A Review and Agenda for Future Research

Graebner¹,

Heimeriks

Huy

et al. 2017

ANNALS

296

354

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Mergers and acquisitions continue to be prevalent despite frequently yielding disappointing outcomes. Post-merger integration plays a critical role in M&A success, yet many questions about M&A implementation remain unanswered. In this article, we review research on post-merger integration, which we organize around strategic integration, sociocultural integration, and experience and learning. We then lay out a research agenda that centers on expanding our understanding of processual dynamics in post-merger integration. We focus on opportunities related to temporality; decision-making; practices and tools; and emotionality.

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How anticipated employee mobility affects acquisition likelihood: Evidence from a natural experiment

Cited by 99 publications

References 104 publications

Fire in the belly? Employee motives and innovative performance in start‐ups versus established firms

Fire in the belly? Employee motives and innovative performance in start‐ups versus established firms

The Value of Employee Retention: Evidence From a Natural Experiment

The Process of Postmerger Integration: A Review and Agenda for Future Research

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