Research
Research
* indicates presentation by co-author
Breaking Network Barriers in the Era of Data-Driven Venture Capitalists
Abstract: Information frictions in financial decision-making are particularly salient in the venture capital (VC) industry, where VCs traditionally rely on professional networks to identify potential investment opportunities. Over the past decade, however, VCs have increasingly adopted digital data and machine learning techniques to inform their investment decisions, marking a significant shift from traditional methods. I posit that these technologies, capable of identifying all startups with a digital presence, reduce information frictions in identifying promising ventures. Using the geographic concentration of the VC industry as my empirical setting, I find that VCs are more likely to invest outside traditional VC hubs after adopting data technologies. Moreover, these investments are more likely to exit through an IPO or achieve unicorn status than their counterparts in established hubs. Additionally, data technologies help locate startups in areas outside major hubs with increasing entrepreneurial activity, which subsequently experience growth in VC activity. These findings highlight the benefits of using data technologies to identify promising ventures, benefiting both investors and emerging VC markets.
Presentations: Rising Scholars Conference MIT (2023), Drexel University Brownbag (2024), WEFI Fellows (2024), Federal Reserve Bank of Philadelphia (2024), FMA Dallas Main Session, Special PhD Paper Presentation, and Doctoral Student Consortium (2024), University of Delaware (2024), Southern Finance Association (2024), American Finance Association Poster Session (2025)
Scheduled: FMARC (2025), Edinburgh Corporate Finance Conference (2025)
Escaping Non-Compete Agreements: The Role of Social Connections (with Jason (Pang-Li) Chen and Torin McFarland)
Abstract: This paper shows that social ties propagate the effects of stricter non-compete agreement (NCA) enforcement across geographic boundaries. While existing studies emphasize negative local impacts of strengthened NCA enforcement, such as decreased labor mobility, reduced wages, and lower innovation output, we explore interstate spillover effects facilitated by inventors' social networks. Using inventor-level data and the Social Connectedness Index developed from Facebook friendship links, we demonstrate that inventors respond to tighter NCA policies by relocating to distant counties where they have strong social ties. Moreover, we find that out-of-state regions with high social proximity to inventors from states with strengthened NCA enforcement experience a 7% growth in both inventor populations and innovation output, measured by increased patent counts and citations. These spillover benefits particularly accrue to young and private firms and result in increased entrepreneurial activity, as measured by new firm formation and venture capital funding. Combined, these findings are consistent with social ties alleviating informational frictions and enhancing labor market matching efficiency. Overall, our findings highlight the importance of social ties in generating cross-regional spillovers when implementing labor mobility policies.
Presentations: FMA Chicago (2023)*, WEFI Fellows (2023), Drexel University Brownbag (2023)*, IFMB Conference (2024), Columbia Private Equity Conference PhD Workshop (2024), Eastern Finance Association (2024)*, ALEA Roundtable (2024), Southern Finance Association (2024)
Learning from the Little Guy: Innovation Spillovers from Private to Public Firms (with Tanja Kirmse)
Abstract: Although research commonly focuses on either public or private firms, little is known about interactions between the two. One natural interaction is in the innovation space, since R&D investment creates knowledge spillovers from firms. We construct a novel measure of knowledge spillovers for public firms from young, private firms. Public firms benefit from private firms through increased innovation quantity and novelty. We identify the causal effect of spillovers using changes in the enforceability of non-compete agreements as a shock to the availability of inventors for private firms. Public firms respond to these spillovers by acquiring more venture capital-backed firms and hiring inventors with prior experience at such firms.
Presentations: FMA New Ideas Session (2023), WEFI Conference (2024), The Friends of Women in Finance (2024)*, Delaware ECGI Corporate Governance Symposium New Ideas Session (2025), Miami University (2025)*, Eastern Finance Association (2025)
Scheduled: FMARC (2025)*, European Financial Management Association (2025)*