Post-M&A Performance in Mobile App Developing Startups

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Abstract/Contents

Abstract: M&A is becoming increasingly common as a key growth and exit mechanism for startups. However, it is still a relatively undocumented phenomenon, due to the challenges of tracking target-specific metrics once the target and acquirer have merged. Using app ranking as a proxy for target performance, I manage to quantify the effects of acquisition on a target’s growth postacquisition. Firstly, we find that mobile app developing startups generally experience significant, positive, and rapid benefits in ranking from being acquired. Secondly, our observations about startups’ positive growth trajectories allow us to make inferences about circumstances where the increased access to resources afforded by an acquisition is particularly valuable in accelerating the target’s growth. Finally, we observe some interesting exceptions where targets’ apps experience rapid declines in ranking post-acquisition, providing empirical evidence for the important roles that startup acquisitions can also play in non-product-related functions, such as acquiring talent or reducing competition.

Type of resource	text
Date created	May 2017

Author	Yeow, Victoria Pei-Zhuang
Primary advisor	Bresnahan, Timothy
Degree granting institution	Stanford University, Department of Economics

Subject	mobile apps
Subject	mergers
Subject	acquisitions
Subject	startups
Subject	survival
Subject	Crunchbase
Subject	innovation
Subject	entrepreneurship
Subject	app ranking
Subject	Mobile Innovation Group
Subject	App Store
Subject	Stanford Department of Economics
Genre	Thesis

Related item	Title 2017 Anna Laura Myers Prize for an Outstanding Thesis
Location	https://purl.stanford.edu/dg421ys2799

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Preferred Citation: Yeow, Victoria Pei-Zhuang. (2017). Post-M&A Performance in Mobile App Developing Startups. Stanford Digital Repository. Available at: https://purl.stanford.edu/dg421ys2799

Stanford University, Department of Economics, Honors Theses

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