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The Role of MIT Alumni Companies in the U.S. Economy 12 Number of Firms Figure 3 Firms Founded by Years After Graduation for Each Decade’s Cohort of Alumni (from li<strong>mit</strong>ed sample only) 2,500 2,000 1,500 1,000 500 0 geographic source distribution of foreign-alumni entrepreneurs will no doubt shift as Asians become a larger fraction of the MIT foreign-student population. Younger Entrepreneurs The tendencies shown in Figures 1 through 4 are clear: More entrepreneurs emerge out of each successive MIT graduating class, and they start their first companies sooner and at earlier ages. To illustrate this, in Figure 3 we display for Bachelor’s degree graduates only how many companies were founded by each decade’s cohort group as a function of the number of years following their MIT graduation. During each successive decade, the cohort of graduating alumni got started in its entrepreneurial behavior sooner (i.e., the cumulative number of companies rises much faster in terms of years after graduation) than the preceding decade’s cohort. Figure 4 shows three frequency distributions of the ages of MIT alumni first-time entrepreneurs for Cumulative Firms Founded by Decade (Bachelor’s Degree) 0-9 10-19 20-29 30-39 40-49 50-59 Years After Graduation Graduates from the 1950s 1960s 1970s 1980s 1990s firms founded during and prior to the 1970s, for those founded in the 1980s, and for those founded in the 1990s. Note the general shifts in the three curves over the years. The distributions show that the more recent entrepreneurs include many more from the younger age brackets, as well as slightly more from the late forties and fifties age brackets. During and prior to the 1970s, 24 percent of the first-time entrepreneurs were under thirty years of age; during the 1980s that number grew to 31 percent; in the 1990s, 36 percent of the founders were under thirty. During and prior to the 1970s, 30 percent of the first-time founders were older than forty years of age; during the 1980s, 28 percent were older than forty; and, in the 1990s, 35 percent were older than forty. More than half of all MIT alumni companies now are founded within ten years of the time the founder graduates from MIT; one-quarter of the companies are founded within six years of graduation. The median age of first-time entrepreneurs gradually has declined from about age forty (1950s) to about age thirty (1990s). Correspondingly, the average time lag ENTREPRENEURIAL IMPACT: THE ROLE OF MIT
Percentage of Entrepreneurs 20 18 16 14 12 10 8 6 4 2 0 The Role of MIT Alumni Companies in the U.S. Economy Figure 4 Age Distribution of Entrepreneurs at Time of First Firm Founding 22-24 28-30 34-36 40-42 46-48 52-54 58-60 64-66 between graduation and first firm founding for alumni from the more recent decades dropped to as low as four years from graduation during the “Internet bubble” years of the 1990s. To check on possible industry effects, we separated out those who had formed software companies. Figure 5 shows that the majority of software founders over all the decades of our study are age thirty or younger and 8 the majority of non-software industry 7 founders are below age thirty-five the year they found their first firms. But, 6 not shown in this <strong>report</strong>, the increase in software entrepreneurship in 5 recent years does not statistically 4 account for the continuing decline in the average entrepreneurial age at 3 time of first company formation. 2 We support the above arguments with the data in Table 3, 1 demonstrating that the ages of first- 0 time MIT alumni entrepreneurs have been getting younger each decade, whether male or female, U.S. or Percentage Age Firms founded during and prior to the 1970s Firms founded in the 1980s Firms founded in the 1990s Figure 5 Age of Founders: Software vs. Other Industries 17 21 25 29 33 37 41 45 49 53 57 61 65 69 73 77 Age at Founding Software Non-software ENTREPRENEURIAL IMPACT: THE ROLE OF MIT 13
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Page 5 and 6: Table of Contents An Evolving MIT I
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Page 17 and 18: Number of Firms 50 45 40 35 30 25 2
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Page 21 and 22: Percentage Global Markets 80 70 60
Page 23 and 24: growth since the 1960s of ventures
Page 25 and 26: Percentage of Revenues 60 50 40 30
Page 27 and 28: Percentage of Capital Coming from E
Page 29 and 30: ’49 started an electronic testing
Page 31 and 32: MIT—Its Unique History, Culture,
Page 47 and 48: The first significant local follow-
Page 49 and 50: documented above, these programs th
Page 51 and 52: Soon, additional entrepreneurship-f
Page 53 and 54: The I-Teams model, initiated by Ken
Page 55 and 56: Number of Entries 250 200 150 100 5
Page 57 and 58: Entrepreneurs promotes networking e
Page 59 and 60: on Patent Policy was formed to addr
Page 61 and 62: Table 16 Primary Universities Doing
Page 63 and 64: Recent MIT Institutional Broadening
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$20 million from Jaishree Deshpande
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entrepreneurship, media, and even b
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lectures, facilitated by direct “
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epresented in the survey responses
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Notes ENTREPRENEURIAL IMPACT: THE R
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ENTREPRENEURIAL IMPACT: THE ROLE OF
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