PUBLICATIONS & RESEARCH PROJECTS
Work in progress
Generative AI and Firm-level Productivity: Evidence from Startup Funding and Employment Dynamics
(w/ Dominik Asam) -- R&R at Strategic Management Journal -- Access current draft here.
Best Paper Award Entrepreneurial Finance Association 2025
This paper provides new evidence on the impact of Generative AI on firm-level productivity by studying the funding and employment dynamics in a large-scale sample of startups. We exploit the release of GitHub Copilot in 2021 as a positive shock to the efficiency of software development. We find that software-developing startups raise their initial funding 19% faster and with 20% fewer employed software developers relative to comparable startups after the release of Copilot. The main results are driven by startups whose founders have high levels of technological and managerial experience. Reflecting our theoretical considerations, these findings demonstrate that new and valuable but non-rival technologies can be a source of competitive advantage for organizations -- but only in combination with complementary resources, such as human capital.
Securing Debt in the Knowledge Economy: Evidence from Intellectual Property Registers
(w/ Laurie Ciaramella & Leo Leitzinger) -- R&R at the Journal of Financial and Quantitative Analysis
Access the current draft here.
This study analyzes the role of using intellectual property (IP) rights as loan collateral in improving access to debt financing. We use novel data from French IP registers combined with firm-level financials to systematically document the characteristics of IP-backed loans and IP-pledging firms. We exploit a major reform in French securities law as a quasi-natural experiment, and show that trademarks and patents can be essential for securing asset-backed loans and that the legal framework effectively shapes its use. Our findings show that IP collateralization can stimulate debt financing in increasingly knowledge-based economies, particularly among small, intangible-rich, and private firms.
Navigating Change in a Dynamic Venture Capital Landscape
(w/ Maria Veihl) -- R&R at Research Policy -- Access the current draft here.
The market conditions for entrepreneurial startups are subject to continuous change with significant implications for their financing activities. This paper investigates the performance implications of the Seed Boom in the US, a substantial rise in early-stage VC investments in young, high-risk startups in the aftermath of the Great Financial Crisis. We document the evolution of early-stage startup financing between 2009 and 2012 and show that its implications for performance are a priori unclear from a theoretical perspective. Our empirical analysis provides robust evidence that startup performance remained stable in terms of exit rates, follow-on equity funding, and the generation of intellectual property. Further, we show that Seed-backed startups shifted towards more differentiated business strategies that serve as critical resources for their entrepreneurial success, while investors adopted risk-mitigating strategies in response to the new market conditions. Consistent with our theoretical considerations about the resilience of startups and investors, these findings suggest that the organizational structure of nascent firms and VCs gives them a high degree of operational flexibility that enables adjustments to changing market conditions. Overall, our analysis highlights the ability of, and workings within, the startup ecosystem to sustain policy- and market-based developments.
Startup Accelerators and International Market Entry: Evidence from the German Accelerator Program
(w/ Daehyun Kim & Dietmar Harhoff) -- Access the current draft here.
European Investment Fund Best Paper Award on Highest Policy Impact 2025
While international expansion can help startups overcome barriers to growth, successful entry into foreign markets remains a significant challenge for them. In this study, we argue that accelerator programs can facilitate startup internationalization by providing experiential learning opportunities. Our empirical analysis exploits a novel setting in which we compare the funding and hiring activities of participants of the German Accelerator (GA)---a government-financed program that offers startups an international learning journey---relative to a comparison group of startups that were admitted, but did not attend for exogenous reasons. To do so, we explore a unique combination of proprietary application data from the GA and detailed startup- and founder-level information from Crunchbase and Revelio as well as qualitative evidence from surveying GA alumni. Our results show that participating startups significantly raise more funding and hire more employees after the program but only from the GA's target countries and not from their home markets. Moreover, quantitative and qualitative evidence suggests that in-person interactions in the target country are essential for eliciting these effects and that startups with limited prior international experience benefit most from participating in the program, both of which support our theoretical considerations. Our study advances the understanding of the potential and the limitations of startup accelerators in supporting international market entry, a key strategy for many entrepreneurial ventures today.
Inventor Returns and Mobility
CEPR Discussion Paper No. 19681 (w/ Dietmar Harhoff & Paul P. Momtaz) -- Access the current draft here.
We show that firm and industry, rather than inventor and invention factors, explain more than half of the variation in inventor returns in administrative employer-inventor-patent-linked data from Germany. Between-firm variation in inventive rents to employed inventors is strongly associated with inventor mobility. Inventors are more likely to make a move just before a patent is filed than shortly thereafter and benefit from their move through a mobility-related marginal inventor return. Employers that pay inventor returns in excess of the expected return gain a favorable position in the market for inventive labor with subsequent increases in patent quality and quantity. Consistent with theoretical arguments, effect sizes also depend on employer-inventor technological complementarity, degree of competition, and invention quality.
Publications
Financial Market Integration and the Effects of Financing Constraints on Innovation
Research Policy (2024), doi.org/10.1016/j.respol.2024.104988; Giorgio Pagliarani Best Paper Award 2024;
Grant recipient of the Academic Research Programme of the European Patent Office (media link)
This paper investigates the effects of financial market integration on firm-level external debt financing and subsequent inventive activities. To this end, I exploit the implementation of the Financial Services Action Plan (FSAP) as a positive exogenous shift integrating European banking markets during the 2000s. My findings show that higher integration relaxes financing constraints, with significant positive effects on firms' use of debt and interest burden, particularly for ex-ante financially constrained firms. Moreover, financial integration spurs innovative activities in terms of patenting of those firms that benefited from the reforms. Considering a variety of qualitative dimensions shows that lifting financing constraints improves patent quality for a subset of previously constrained firms with low ex-ante patenting intensities (entrants) while adversely affecting the inventive output of incumbent patenters in the spirit of a quantity-quality tradeoff. These findings highlight the key function of a conducive financing environment for inventive activities but also reveal unintended limitations of policy-induced improvements in access to financing.
Leveraging Intellectual Property: The Value of Harmonized Enforcement Regimes
Journal of Banking & Finance (2024), doi.org/10.1016/j.jbankfin.2024.107169 -- (w/ Andrej Gill)
Enabling or Accelerating? The Timing of Innovation and the Different Roles of Venture Capitalists
Research Policy (2024), doi.org/10.1016/j.respol.2024.105060 -- (w/ Andrej Gill & Nina A. Michel).
This paper investigates two pivotal roles in how venture capitalists (VCs) affect their targets' innovative activities. To this end, we explore the timing of patenting around initial VC investments using a novel dataset that combines European firm-, patent-, and investment-level information on first-round targets between 1995 and 2015. In matched sample regressions, we find a positive (enabling) effect of VCs on the quantity and quality of patenting activities, i.e., for targets without pre-VC patenting activity. Results apply persistently over time, suggesting that VCs push for commercialization while also driving sustained patenting. We further find a positive (accelerating) effect for targets with pre-VC patenting, but only for a subset of specifically involved, experienced investors. Multiple tests suggest that selection effects do not drive our findings. The findings improve our understanding of VCs' roles in startup innovation processes and emphasize the diverse effects VCs can have on the trajectories of their target firms.
Small and Vulnerable during Crises? Firm Size and Financing Constraints Dynamics
Small Business Economics (2025), https://doi.org/10.1007/s11187-024-00996-y -- (w/ P. Karapanagiotis & Ø. Nilsen)
This study analyzes the dynamics of financing constraints under changing economic conditions and the role of firm size in this context. Using administrative data from Germany, we quantify financing constraints expressed as the probability that a firm encounters excess demand or excess supply. On average, small and medium-sized enterprises (SMEs) are indeed more likely than larger firms to face excess demand for loans. Using the Great Financial Crisis as an empirical setting, we show that tightening financing conditions do not affect smaller firms disproportionally, but generally risky borrowers. Importantly, post-crisis trends in debt-ratios, profitability, investments, and employment are similar irrespective of firm size, while smaller firms respond to the economic slowdown by persistently building up cash buffers. Our results urge policymakers to consider specific characteristics of bank-dependent firms to assess their exposure to economic crises - instead of focusing on size as a vulnerability criteria per se.
Intellectual Property as Business Loan collateral: A Taxonomy on Institutional and Economic Determinants GRUR International (2024), doi.org/10.1093/grurint/ikae043 -- (w/ Leo Leitzinger & Uwe Walz)
As a promising strategy, firms can use their intellectual property rights (IPR) as collateral to secure debt financing. Despite an ongoing shift to a more technology-based economy, the collateralizing of IPR is still trailing behind the use of more traditional asset classes. In this paper, we develop a new taxonomy on the key determinants of using IPR as collateral. The taxonomy defines two pillars that govern the use of IPR collateral that distinguish between institutional and economic determinants. The institutional determinants cover contract law, IPR registries, and banking regulation. The economic determinants constitute the influence of IPR characteristics on the trade-off between the economic costs and benefits of collateralizing IPR. We propose that IPR collateral can have significant advantages regarding signaling, agency issues, and the creation of pledgable income. We apply the derived taxonomy to the legal and economic status quo in several industrialized economies to identify potential impediments to IPR-backed debt financing. Taken together, our taxonomy can be viewed as the foundation for future research on IPR as loan collateral for businesses, both in the fields of law and economics.
View my Google Scholar Profile (here)
Work in progress (selected):
- Same, same, but different: The dynamic effects of multilayered founder team diversity and startup performance (w/ J. Cho & M. Colombo)
- Learning by Watching: Western TV Access and Innovation Activity in the German Democratic Republic (w/ D. Harhoff & K. Wernsdorf)
- The Reign of the Great Banks: Financial Development, Firm Performance, and Innovation in Imperial Germany (w/ M. Liebald)
- Supply Chain Disruptions and Innovation (w/ C. Chen, C. Eufinger, & S. Sacchetto)
- Debt financing, Intellectual Property, and Climate Investments: Evidence from German SMEs (w/ J. Block)
- Entrepreneurial Growth with Generative Artificial Intelligence (w/ D. Asam & D. Kim)