New venture teams and acquisition: Team composition matters

Figures & data

Table 1. Variable definitions.

	Variable	Definition
Dependent Variable	Acquisition	1 = M&A, otherwise 0
	Closure	1 = Closure, otherwise 0
Independent Variables	Gender diversity	Standard deviation = square root of (p*(1-p)), where p is the proportion of female in the first year
	Nationality diversity	Standard deviation = square root of (p*(1-p)), where p is the proportion of non-US born in the first year
	Average education level^a	Average of education level per firm founder in the first year
	Education level diversity	Blau’s index of education level per firm founder in the first year
	Average industry experience	Average number of years of work experience in the industry per firm founder in the first year
	Industry experience diversity	Standard deviation of number of years of work experience in the industry per firm founder in the first year
Control Variables	Average age	Average reported age per firm founder in the first year
	Age diversity	Standard deviation of reported age per firm founder in the first year
	Race diversity	Standard deviation = square root of (p*(1-p)), where p is the proportion of non-white in the first year
	Commitment – hours worked	Average reported weekly working hours per firm founder
	Commitment – equity owned	Percentage of equity owned by founders in the first year
	Couple	1 if the size of team is equal to two and the spouse own the equity in the firm, otherwise 0
	Team size	Number of active owners in the first year
	Industry technology level^b	1 if firm is in high-tech category, 0 otherwise
	Firm size	Logarithm of total assets of the firm in the first year
	Patent	1 if the venture has patent(s) in the first year, otherwise 0

^aCategories: 1 = less than 9th grade; 2 = some high school; 3 = high school diploma/equivalent; 4 = technical/trade/vocational degree; 5 = some college; 6 = associate’s degree; 7 = bachelor’s degree; 8 = some graduate school; 9 = master’s degree; and 10 = professional school or doctorate.

^bBased on the percentage of employment dedicated to research and development in the firm, the KFS determined four industries as high tech: chemicals and allied products, industrial machinery and equipment, electrical and electronic equipment, and instruments and related products.

Table 2. Descriptive statistics and correlations.

	Variable	1	2	3	4	5	6	7	8		9	10	11	12	13	14	15	16	17	18
1	Acquisition	1.000
2	Closure	−0.030*	1.000
3	Gender diversity	−0.001	0.002	1.000
4	Couple	−0.011	0.013	0.006	1.000
5	Nationality diversity	−0.008	−0.022	−0.110*	−0.024	1.000
6	Race diversity	0.005	0.009	0.006	−0.038*	0.080*	1.000
7	Average education	0.027	−0.050*	−0.086*	0.031*	0.220*	0.049*	1.000
8	Education diversity	0.010	0.018	0.087*	−0.040	−0.093*	0.021	−0.110		1.000
9	Average experience	−0.004	−0.049*	−0.173*	−0.073*	0.035*	0.036*	0.028*		−0.035*	1.000
10	Experience diversity	−0.028*	−0.025	0.065*	−0.033*	0.032*	−0.025	−0.082*		0.103*	0.409*	1.000
11	Work hours	0.028*	−0.053*	−0.165*	−0.011	0.071*	0.059*	−0.072*		−0.035*	0.092*	0.034*	1.000
12	Equity owned	−0.030*	−0.011	0.164*	−0.020	−0.136*	−0.042*	−0.139*		−0.030*	−0.075*	−0.068*	−0.051*	1.000
13	Average age	−0.005	0.009	0.089*	−0.020	−0.022	0.001	0.124*		−0.020	0.345*	0.228*	−0.136*	−0.041*	1.000
14	Age diversity	−0.001	−0.011	−0.259*	−0.060*	−0.004	0.021	−0.022		0.183*	0.099*	0.208*	0.029*	−0.034*	0.087*	1.000
15	Team size	0.049*	−0.030*	−0.073*	−0.082*	0.013	0.102*	0.063*		0.215*	0.059*	0.079*	−0.013	−0.147*	−0.008	0.184*	1.000
16	Firm size	0.037*	−0.058*	−0.046*	−0.018	0.059*	−0.022	0.002		0.007	0.024	0.068*	0.175*	−0.116*	0.076*	0.024	0.082*	1.000
17	Technology level	−0.007	−0.041*	−0.120*	−0.014	0.081*	0.059*	0.059*		0.034	0.159*	0.113*	0.094*	−0.146*	0.099*	0.088*	0.065*	0.075*	1.000
18	Patent	0.013	−0.022	−0.104*	0.012	0.165*	0.006	0.220*		−0.066*	0.079	0.045	0.031	−0.192*	0.063*	0.075*	0.019	0.060*	0.252*	1.000
Mean		0.012	0.057	0.249	0.034	0.032	0.051	6.406		0.350	11.461	6.303	36.710	94.696	45.455	5.412	2.281	9.761	1.185	0.065
SD		0.110	0.232	0.247	0.181	0.121	0.149	1.801		0.239	8.317	6.157	19.214	16.551	9.492	5.365	0.648	3.602	0.388	0.246

 *p < .05.  

Table 3. Logistic regression for acquisition.

	Model 1	Model 2	Model 3	Model 4
Controls
High-tech	1.056 (0.371)	1.177 (0.392)	1.121 (0.396)	1.166 (0.404)
Firm size	1.088^+ (0.048)	1.105* (0.050)	1.115* (0.052)	1.061 (0.045)
Patent	0.655 (0.654)	0.729 (0.633)	0.764 (0.645)	0.885 (0.657)
Average age	0.988 (0.017)	0.978 (0.018)	0.977 (0.019)	0.977 (0.020)
Age diversity	0.975 (0.030)	1.013 (0.029)	1.004 (0.031)	1.008 (0.031)
Work hours	1.009 (0.008)	1.014 (0.008)	1.012 (0.009)	1.008 (0.009)
Equity owned	0.989 (0.008)	0.983* (0.007)	0.984* (0.007)	0.978** (0.007)
Team size	1.278* (0.097)	1.305** (0.083)	1.329** (0.087)	1.354*** (0.081)
Couple	0.085* (1.036)	0.070* (1.052)	0.061** (1.057)	0.085* (1.056)
Race diversity	0.837 (1.202)	1.027 (1.120)	1.023 (1.140)	1.372 (1.143)
Profitability				1.001* (0.000)
Independent variables
Gender diversity		4.931* (0.658)		5.864* (0.690)
Nationality diversity		0.087 (1.620)		0.110 (1.652)
Average education level		1.253* (0.093)	1.262* (0.094)	1.244* (0.099)
Education level diversity		0.884 (0.698)	1.103 (0.709)	0.966 (0.720)
Average industry experience		1.022 (0.021)	1.018 (0.021)	1.017 (0.022)
Diversity industry experience		0.898** (0.035)	0.902** (0.038)	0.922* (0.033)
Female ratio			2.711* (0.415)
Non-US born ratio			0.062^+ (1.590)
Constant	0.008** (1.508)	0.003*** (1.622)	0.003*** (1.636)	0.003*** (1.65)
N	4,537	4,508	4,508	4,214
F	6.84	6.31	7.25	6.81
Prob > F	0.000	0.000	0.000	0.000

⁺p <.10, *p <.05, **p <.01, ***p <.001.

Standard errors in parentheses.

Table 4. Logistic regression for closure.

	Model 1	Model 2	Model 3	Model 4
Controls
High-tech	0.663* (0.209)	0.704^+ (0.213)	0.695^+ (0.211)	0.747 (0.222)
Firm size	0.972 (0.018)	0.976 (0.019)	0.975 (0.019)	0.980 (0.019)
Patent	0.742 (0.517)	0.944 (0.497)	0.928 (0.533)	0.735 (0.579)
Average age	0.997 (0.008)	1.005 (0.008)	1.005 (0.008)	1.006 (0.008)
Age diversity	0.999 (0.013)	0.987 (0.014)	0.993 (0.013)	0.980 (0.015)
Work hours	0.992* (0.004)	0.991* (0.004)	0.992* (0.004)	0.991* (0.004)
Equity owned	0.999 (0.005)	0.997 (0.005)	0.997 (0.005)	1.001 (0.005)
Team size	0.799^+ (0.122)	0.751* (0.139)	0.736* (0.141)	0.691** (0.138)
Couple	1.601 (0.344)	1.720 (0.351)	1.864^+ (0.350)	1.435 (0.368)
Race diversity	0.937 (0.466)	0.939 (0.489)	0.903 (0.480)	0.993 (0.520)
Profitability				0.999** (0.000)
Independent variables
Gender diversity		0.550+ (0.333)		0.535+ (0.341)
Nationality diversity		0.623 (0.835)		0.498 (0.919)
Average education level		0.872** (0.044)	0.869** (0.044)	0.857** (0.047)
Education level diversity		2.352** (0.331)	2.253* (0.320)	3.540*** (0.364)
Average industry experience		0.980^+ (0.011)	0.981^+ (0.011)	0.980^+ (0.011)
Diversity industry experience		0.990 (0.014)	0.988 (0.013)	0.992 (0.014)
Female ratio			0.637 (0.281)
Non-US born ratio			1.085 (0.527)
Constant	1.065 (0.709)	1.068 (0.780)	1.064 (0.780)	1.064 (0.847)
N	4,537	4,508	4,508	4,214
F	3.36	3.44	3.42	3.34
Prob > F	0.000	0.000	0.000	0.000

⁺p <.10, *p <.05, **p <.01, ***p <.001.

Standard errors in parentheses.