Different founders, different venture outcomes: A comparative analysis of academic and non-academic startups

What role do differences in founders' occupational backgrounds play in new venture performance? Analyzing a novel dataset of 2998 founders creating 1723 innovative startups in biomedicine, we find that the likelihood and hazard of achieving a liquidity event are lower for academic than for non-academic startups. However, academic startups produce as many patents and receive as much funding as non-academic startups, suggesting that the observed differences in achieving a liquidity event are not driven by differential invention performance. Exploiting heterogeneity among academic startups, we also find that differences between professor and student startups do not explain academic startups' comparatively low performance on the exit market vis-a-vis non-academic startups. Yet, startups founded by superstar professors perform similarly to non-academic startups on the exit market for new ventures, and better than startups founded by highly productive professors but without external certification.