Skip to Main Content
HBS Home
  • About
  • Academic Programs
  • Alumni
  • Faculty & Research
  • Baker Library
  • Giving
  • Harvard Business Review
  • Initiatives
  • News
  • Recruit
  • Map / Directions
Faculty & Research
  • Faculty
  • Research
  • Featured Topics
  • Academic Units
  • …→
  • Harvard Business School→
  • Faculty & Research→
Publications
Publications
  • 2016
  • Working Paper
  • HBS Working Paper Series

Are 'Better' Ideas More Likely to Succeed? An Empirical Analysis of Startup Evaluation

By: Erin L. Scott, Pian Shu and Roman M. Lubynsky
  • Format:Print
  • | Language:English
  • | Pages:46
ShareBar

Abstract

This paper studies the uncertainty associated with screening early stage ventures. Using data on 652 ventures in high-growth industries, we examine whether experienced entrepreneurs, executives, and investors can predict the outcomes of early stage ventures by reading succinct summaries of their business ideas without meeting the founding teams. We find that the predictability of venture outcomes varies with the intensity of research and development (R&D) in the sector. In R&D-intensive sectors, such as life sciences, the ideas that elicit more positive evaluations are significantly more likely to reach commercialization and/or to raise substantial funding; this pattern does not hold for ventures in non-R&D–intensive sectors such as enterprise software. Our results suggest that, despite the many uncertainties associated with innovating at the technological frontier, early stage ventures in R&D-intensive sectors can be screened effectively using information on their non-human capital assets. In contrast, such information is not sufficient to screen ventures in non-R&D-intensive sectors.

Keywords

Commercialization; Entrepreneurship; Business Startups

Citation

Scott, Erin L., Pian Shu, and Roman M. Lubynsky. "Are 'Better' Ideas More Likely to Succeed? An Empirical Analysis of Startup Evaluation." Harvard Business School Working Paper, No. 16-013, July 2015. (Revised October 2016.)
  • SSRN
  • Read Now

Related Work

    • 2016
    • Faculty Research

    Are 'Better' Ideas More Likely to Succeed? An Empirical Analysis of Startup Evaluation

    By: Erin L. Scott, Pian Shu and Roman M. Lubynsky
Related Work
  • Are 'Better' Ideas More Likely to Succeed? An Empirical Analysis of Startup Evaluation By: Erin L. Scott, Pian Shu and Roman M. Lubynsky
ǁ
Campus Map
Harvard Business School
Soldiers Field
Boston, MA 02163
→Map & Directions
→More Contact Information
  • Make a Gift
  • Site Map
  • Jobs
  • Harvard University
  • Trademarks
  • Policies
  • Accessibility
  • Digital Accessibility
Copyright © President & Fellows of Harvard College