TY - UNPB
T1 - Start-up Acquisitions, Venture Capital and Innovation: A Comparative Study of Google, Apple, Facebook, Amazon and Microsoft
AU - Gugler, Klaus
AU - Szücs, Florian
AU - Wohak, Ulrich
PY - 2023/7
Y1 - 2023/7
N2 - We evaluate the impact of big-tech acquisitions on the incentives for investment and innovation. Using data on several hundred acquisitions by Google, Apple, Facebook, Amazon and Microsoft (GAFAM), we study the evolution of venture capital investment and patenting relative to control groups. The results show a clear negative impact on investment, while the effect on innovation depends on the acquirer and period. Both outcomes improve over time, as GAFAM firms become more similar in terms of their product and tech-portfolios, increasing competition. Yet, around 10% of acquisitions impact both metrics negatively.
AB - We evaluate the impact of big-tech acquisitions on the incentives for investment and innovation. Using data on several hundred acquisitions by Google, Apple, Facebook, Amazon and Microsoft (GAFAM), we study the evolution of venture capital investment and patenting relative to control groups. The results show a clear negative impact on investment, while the effect on innovation depends on the acquirer and period. Both outcomes improve over time, as GAFAM firms become more similar in terms of their product and tech-portfolios, increasing competition. Yet, around 10% of acquisitions impact both metrics negatively.
KW - M&A
KW - big-tech
KW - innovation
KW - investment
U2 - 10.57938/2f8d7b88-c44e-4933-b926-03d1460bf880
DO - 10.57938/2f8d7b88-c44e-4933-b926-03d1460bf880
M3 - WU Working Paper
T3 - Department of Economics Working Paper Series
BT - Start-up Acquisitions, Venture Capital and Innovation: A Comparative Study of Google, Apple, Facebook, Amazon and Microsoft
PB - WU Vienna University of Economics and Business
ER -