David Hsu

David Hsu
  • Richard A. Sapp Professor
  • Professor of Management

Contact Information

  • office Address:

    2028 SH-DH
    3620 Locust Walk
    Philadelphia, PA 19104

Research Interests: intellectual property rights, start-up innovation, strategies for commercializing technological innovation, venture capital

Links: CV, Personal Website

Overview

David Hsu is the Richard A. Sapp Professor of Management at the Wharton School, University of Pennsylvania. He graduated from Stanford University with undergraduate majors in economics and political science. After a few years working in industry, he received his master’s degree in public policy from Harvard University, followed by his Ph.D. in management from the Massachusetts Institute of Technology.

Hsu’s research interests are in entrepreneurial innovation and management. Within that domain, he has investigated topics such as intellectual property management, start-up innovation, technology commercialization strategy, and venture capital. His research has appeared in leading journals such as Management Science, Journal of Finance, Strategic Management Journal, and Research Policy. He is past department and associate editor of Management Science. In 2008, Hsu was awarded an Alfred P. Sloan Foundation Industry Studies Fellowship. At Wharton, he teaches two MBA electives, Entrepreneurship and Technology Strategy. At Penn, Hsu is Associate Faculty Director of the Weiss Tech House, which encourages and supports students in the creation, development, and commercialization of innovative technologies.

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Research

  • David Hsu and Jeffrey Kuhn (2022), Academic Stars and Licensing Experience in University Technology Commercialization, Strategic Management Journal.

    Abstract: We examine the process by which university technology transfer offices (TTOs) allocate internal resources, which provides insight into technologies offered for commercialization to the private sector. Using detailed administrative records of patenting decisions and outcomes by one prominent U.S. research-based university's TTO over a 30-year period, we analyze the performance of invention disclosures by academic stars and by inventors with prior licensing experience. We find that the lead inventor's academic prominence (but not licensing experience) predicts patent application filing, while licensing experience (but not academic prominence) predicts patent impact and commercialization success. We supplement this descriptive analysis with follow-up interviews and empirical evaluation of possible mechanisms for this seemingly outsized role of academic stars.

  • David Hsu and Prasanna Tambe (Working), How Does Offering Remote Work Affect the Diversity of the Labor Pool? Evidence from Technology Startups.

    Abstract: A significant element of managerial post-COVID job design regards remote work. In an era of renewed recognition of diversity, equity and inclusion, employers may wonder how diverse (gender and race) and experienced job applicants respond to remote job listings, especially for high-skilled technical and managerial positions. Prior work has shown that while remote work allows employee flexibility, it may limit career promotion prospects, so the net effect of designating a job as remote-eligible is not clear from an applicant interest standpoint, particularly when recruiting females and underrepresented minorities (URM). We analyze job applicant data from a leading startup job platform, AngelList Talent, that spans long windows before and after the COVID-19 pandemic-induced shutdowns of March 2020. To overcome the empirical challenge that remote job designation may be co-determined with unobserved job and employer characteristics, we leverage a matching approach (and an alternative method which leverages the sudden shutdowns) to estimate how applicant characteristics differ for otherwise similar remote and onsite job postings. We find that offering remote work attracts more experienced and diverse job applicants, with larger effects in less diverse geographic areas. When onsite and remote jobs receive similar numbers of applications, remote jobs attract about 1.25 more applications from URM candidates and from women, and applicants have about 1 year more of experience. The average estimated compensated wage differential for remote work is about 7% (for females 17% and for URM candidates 3%) of posted salaries.

  • Suting Hong, Kaihao Guo, Haipeng Zhang, David Hsu (Working), When Do Ventures Founded by Research-oriented Entrepreneurs Outperform?.

    Abstract: Holders of a STEM doctoral degree are increasingly pursuing non-academic careers for a variety of reasons. There has been special interest in one such path, founding new ventures, because of its potentially disproportionate impact on societal and economic outcomes. We explore the conditions under which “research-oriented” founders (operationalized as those who have published in the peer-reviewed scientific literature) outperform otherwise observationally similar non-research-oriented founders in venture performance. Our contingency-based inquiry helps reduce tension in the literature which has found seemingly conflicting results on performance advantages to such academic founders. We also extend the human capital construct to the founding team and investor level, as such participants may assist in deficiencies in knowledge and expertise at the individual level. Our data consists of a matched sample of several thousand ventures across a wide span of industrial fields. Our results suggest that research-oriented founders’ ventures outperform when they start ventures in their field of expertise, especially so when they are academically accomplished. Furthermore, for research-oriented founders starting ventures outside of their domain of expertise, recruiting co-founders with complementary functional backgrounds can compensate, though the same statement cannot be said about investors with complementary skills. We end by discussing policy implications.

  • Matt Marx and David Hsu (2022), Revisiting the Entrepreneurial Commercialization of Science: Evidence from ‘Twin’ Discoveries, Management Science, 68, pp. 1330-1352.

    Abstract: What factors shape the commercialization of academic scientific discoveries via startup formation? Prior literature has identified several contributing factors but does not address the fundamental problem that the commercial potential of a nascent discovery is generally unobserved and potentially confounds inference. We construct a sample of over 20,000 “twin” scientific articles, which allows us to hold constant differences in the nature of the advance and more precisely examine characteristics that predict startup commercialization. In this framework, several commonly-accepted factors appear not to influence commercialization. However, we find that teams of academic scientists whose former collaborators include “star” serial entrepreneurs are much more likely to commercialize their own discoveries via startups, as are more interdisciplinary teams of scientists.

  • David Hsu, Po-Hsuan Hsu, Qifeng Zhao (2021), Rich on Paper? Chinese Firms’ Academic Publications, Patents, and Market Value, Research Policy, 104319.

    Abstract: By combining various databases of academic publications and patents of China’s publicly listed firms, we explore the effects of academic publications on firm valuation. We find that Chinese firms’ academic publications are positively associated with their market valuation. More importantly, such a positive relation is more pronounced when these firms have stronger patent records, highlighting a synergy between basic research and applied technologies. Mechanism tests indicate that firms’ academic publications promote their market values through enhancing their human capital and sending credible signals to the market. We also find that publications in English-language journals are more value-relevant than in Chinese-language journals.

  • David Hsu, Po-Hsuan Hsu, Tong Zhou, Arvids Ziedonis (2021), Benchmarking U.S. University Technology Commercialization Efforts: A New Approach, Research Policy.

    Abstract: Despite the economic significance of patented university research, it is difficult to measure the economic value of academic patented inventions and observe the extent to which universities are able to capture such value through patent licensing. Moving beyond assessing commercialization performance by simple statistics, we propose a new approach to benchmarking university patents and commercialization performance based on comparative corporate patent value. Our procedure involves matching university patents to patents with similar patent characteristics granted to public corporations, then estimating the “potential value” of these university patents by stock market reactions to grants of the matched corporate patents. These estimated values of university patents can significantly explain the technology-level income from licensing by a leading US research university and the annual licensing income of the member universities of the Association of University Technology Managers’ (AUTM). We find that AUTM universities realize an average of 16% of the estimated value of matched corporate patents. We also investigate correlates of university-level potential patent value and suggest avenues for future research.

  • David Hsu, Po-Hsuan Hsu, Kaiguo Zhou, Tong Zhou (Working), Industry-University Collaboration and Commercializing Chinese Corporate Innovation.

    Abstract: We examine how industry-university collaboration (IUC) enhances Chinese firms’ commercialization of their technologies using a comprehensive dataset of medium sized and large industrial firms and research universities in China. Measuring IUC with the occurrence and frequency of patents co-assigned to both firms and universities, we first document that firms with more IUC activities report more new product sales. Both dynamic difference-in-differences analysis and instrumental variable regressions support a causal interpretation of the positive relation. In addition, firms with more IUC activities produce more patents and patents that are of higher quality, are closer to basic science, and are more exploratory – all confirming an innovation-enhancing mechanism. Further evidence suggests that our results can be attributed to two channels through which firms benefit from IUC: knowledge acquisition and talent recruiting.

  • David Hsu, Po-Hsuan Hsu, Yunan Liu, Long Yi (Working), Public Listing, Managerial Short-Termism, and Brand Development.

    Abstract: We construct a novel and comprehensive dataset of trademarks owned by big privately held and publicly listed firms in the U.S. over three decades to examine whether and how public listing status affects product inventions. We find that while publicly listed firms register more product inventions compared with their big privately held counterparts, their product inventions are less likely to survive long. We attribute these patterns to the short-termism of public firms’ managers, which is supported by a test based on short-term institutional investors. Using an unexpected court ruling in the Ninth Circuit Court that enhanced managerial short-termism for public firms as an identification test, we find that the relation between the public listing status and product inventions strengthens after this ruling, which supports a causal interpretation of our results.

  • David Hsu and Jeffrey Kuhn (Working), The Outsized Role of Academic Stars in University Technology Licensing.

    Abstract: The decline in U.S. corporate R&D over time raises the importance of university-based research in the innovation ecosystem. We examine the process by which university technology transfer offices (TTOs) allocate internal resources, which provides insight into technologies offered for commercialization to the private sector. We compare resource allocation according to academic “star” status against a commercial experience logic. We analyze detailed administrative records of patenting decisions and outcomes by one prominent U.S. research-based university’s TTO over a 30-year period. We find academic stars wield outsized influence: their patent applications are more likely to be filed, yet are less likely to be issued; they are no more likely to have their patents licensed and their patents are no different (statistically) in their licensing revenue from non-stars.

  • Po-Hsuan Hsu, Dokyun Lee, Prasanna Tambe, David Hsu (Working), Deep Learning, Text, and Patent Valuation.

    Abstract: This paper uses deep learning and natural language processing (NLP) methods on the US patent corpus to evaluate their predictive power in estimating two measures of patent value: (i) investor reaction to patent announcements as measured in Kogan et al., 2017 and (ii) forward citations. While forward citations have traditionally been used as measures of economic value in the literature, their utility is mainly retrospective. Contemporaneous predictions of patent value, as embodied in investor reactions to patent grants, can be important for managers and policy-makers for prospective decision making. We compare the prediction performance of models using the structured features of the patent (number of citations, technology class, etc.) to deep learning and NLP methods. Relative to linear regression models using the same features, deep learning models reduce mean absolute error (MAE) by approximately 32%. Incorporating patent text further lowers the MAE by 13%.

Teaching

Current Courses (Spring 2023)

  • MGMT6120 - Managing Emerg Entrprse

    This course is about managing during the early stages of an enterprise, when the firm faces the strategic challenge of being a new entrant in the market and the organizational challenge of needing to scale rapidly. The enterprises of interest in this course have moved past the purely entrepreneurial phase and need to systematically formalize strategies and organizational processes to reach maturity and stability, but they still lack the resources of a mature firm. The class is organized around three distinct but related topics that managers of emerging firms must consider: strategy, human and social capital, and global strategy.

    MGMT6120001 ( Syllabus )

    MGMT6120002 ( Syllabus )

    MGMT6120003 ( Syllabus )

  • MGMT8880 - Venture Acceleration Lab

    This Lab emphasizes experiential learning in evaluating and contributing to “live” startup ventures. The goal of the Lab is to accelerate the development of ventures by providing a structured curricular setting in which mentors with industry expertise as operators and investors provide guidance to full-time venture founders. Undergraduate and MBA students learn through witnessing these interactions and through helping ventures structure their value creation and capture strategies. The latter is facilitated via instructor-led classes on focused venture development concepts. This unique Lab therefore brings together communities which rarely mix: startup founders, enrolled students as potential venture “joiners” and consultants, venture mentors, and technical/academic specialists.

    MGMT8880401 ( Syllabus )

  • MGMT3880 - Venture Acceleration Lab

    This Lab emphasizes experiential learning in evaluating and contributing to “live” startup ventures. The goal of the Lab is to accelerate the development of ventures by providing a structured curricular setting in which mentors with industry expertise as operators and investors provide guidance to full-time venture founders. Undergraduate and MBA students learn through witnessing these interactions and through helping ventures structure their value creation and capture strategies. The latter is facilitated via instructor-led classes on focused venture development concepts. This unique Lab therefore brings together communities which rarely mix: startup founders, enrolled students as potential venture “joiners” and consultants, venture mentors, and technical/academic specialists.

    MGMT3880401 ( Syllabus )

  • MGMT9990 - Independent Study

    MGMT9990005 ( Syllabus )

All Courses

  • MGMT3880 - Venture Acceleration Lab

    This Lab emphasizes experiential learning in evaluating and contributing to “live” startup ventures. The goal of the Lab is to accelerate the development of ventures by providing a structured curricular setting in which mentors with industry expertise as operators and investors provide guidance to full-time venture founders. Undergraduate and MBA students learn through witnessing these interactions and through helping ventures structure their value creation and capture strategies. The latter is facilitated via instructor-led classes on focused venture development concepts. This unique Lab therefore brings together communities which rarely mix: startup founders, enrolled students as potential venture “joiners” and consultants, venture mentors, and technical/academic specialists.

  • MGMT6110 - Managing Est Enterprise

    This course is about managing large enterprises that face the strategic challenge of being the incumbent in the market and the organizational challenge of needing to balance the forces of inertia and change. The firms of interest in this course tend to operate in a wide range of markets and segments, frequently on a global basis, and need to constantly deploy their resources to fend off challenges from new entrants and technologies that threaten their established positions. The class is organized around three distinct but related topics that managers of established firms must consider: strategy, human and social capital, and global strategy.

  • MGMT6120 - Managing Emerg Entrprse

    This course is about managing during the early stages of an enterprise, when the firm faces the strategic challenge of being a new entrant in the market and the organizational challenge of needing to scale rapidly. The enterprises of interest in this course have moved past the purely entrepreneurial phase and need to systematically formalize strategies and organizational processes to reach maturity and stability, but they still lack the resources of a mature firm. The class is organized around three distinct but related topics that managers of emerging firms must consider: strategy, human and social capital, and global strategy.

  • MGMT8010 - Entrepreneurship

    MGMT 801 is the foundation coures in the Entrepeurial Management program. The purpose of this course is to explore the many dimensions of new venture creation and growth. While most of the examples in class will be drawn from new venture formation, the principles also apply to entrepreneurship in corporate settings and to non-profit entrepreneurship. We will be concerned with content and process questions as well as with formulation and implementation issues that relate to conceptualizing, developing, and managing successful new ventures. The emphasis in this course is on applying and synthesizing concepts and techniques from functional areas of strategic management, finance, accounting, managerial economics, marketing, operations management, and organizational behavior in the context of new venture development. The class serves as both a stand alone class and as a preparatory course to those interested in writing and venture implementation (the subject of the semester-long course, MGMT 806). Format: Lectures and case discussions

  • MGMT8880 - Venture Acceleration Lab

    This Lab emphasizes experiential learning in evaluating and contributing to “live” startup ventures. The goal of the Lab is to accelerate the development of ventures by providing a structured curricular setting in which mentors with industry expertise as operators and investors provide guidance to full-time venture founders. Undergraduate and MBA students learn through witnessing these interactions and through helping ventures structure their value creation and capture strategies. The latter is facilitated via instructor-led classes on focused venture development concepts. This unique Lab therefore brings together communities which rarely mix: startup founders, enrolled students as potential venture “joiners” and consultants, venture mentors, and technical/academic specialists.

  • MGMT8900 - Advanced Study-Ind

  • MGMT8930 - Advanced Study-Emgt

  • MGMT8970 - Global Modular Course A

    Special course arranged for Wharton MBA students, focused on global business, management and innovation.

  • MGMT9320 - Prosem in Mgmt

    This course is designed to provide students with an understanding of the methodological approaches we commonly think of as qualitative, with special emphasis on ethnography, semi- structured interviews, case studies, content analysis, and mixed-methods research. The course will cover the basic techniques for collecting, interpreting, and analyzing qualitative (i.e. non-numerical) data. In the spring quarter, the course will operate on two interrelated dimensions, one focused on the theoretical approaches to various types of qualitative research, the other focused on the practical techniques of data collection, such as identifying key informants, selecting respondents, collecting field notes and conducting interviews. In the fall semester, the course will operate on two interrelated dimensions, one focused on the theoretical approaches on building arguments and theory from qualitative data, the other focused on the practical techniques of data collection, such as analyzing data, writing, and presenting findings. Note: This class is part of a two-part sequence which focuses on qualitative data collection and analysis. The first of this course, offered in the Spring, focuses on data collection and the second half of the course, offered the following Fall, will focus on qualitative data analysis. Each course is seven weeks long. Students may take either class independently or consecutively.

  • MGMT9370 - Entrep Research Seminar

    The seminar seeks to expose students to theoretical and empirical perspectives on entrepreneurship research. We will focus on the main questions that define the field and attempt to critically examine how, using a range of methodologies, researchers have approached these questions. As we review the literature, we will seek to identify promising research areas, which may be of interest to you in the context of your dissertation research. In addition to addressing the content of the received literature, we will examine the process of crafting research papers and getting them published in top tier journals. Towards that end we will characterize the key elements of high impact papers and review the development process of such studies. Students are expected to come fully prepared to discuss and critique the readings that are assigned to each class meeting (see details below). Each student will serve as the discussion leader for one or more of the class sessions. Discussion leaders are expected to critically review several articles, identify new insights in the research that is being reviewed and evaluate its contribution to the literature, position the articles within the literature on the subject matter, raise discussion question, and act as the discussion moderator for the class session. Each discussion leader is asked to prepare a one or two page summary of the assigned papers which includes a statement of the main research question(s), the methodology, data set if any, summary of findings, a commentary with your thoughts on the reading, and proposed discussion questions. Prior to each class, the discussion leader will meet the instructor to help plan the class meeting. Towards the end of each class meeting, each student will be asked to articulate a research question that emerged from the session and describe the research design used to investigate the issue.

  • MGMT9390 - Ent Innov Research

    This quarter-length course explores key topics at the intersection of entrepreneurship and innovation. While the course primarily draws from established theory and empirics from management and economics, it will also include discussions of emerging phenomena in this rapidly evolving field. We will begin by reviewing the basic properties of ideas that uniquely shape the sources and dynamics of entrepreneurship and innovation. Subsequently, we will explore innovation-related challenges and opportunities for startups. Special focus will be placed on research application in which students design and present their own research proposal broadly in the area of entrepreneurship and innovation. Students are highly encouraged to take this course in sequence with MGMT 937.

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David Hsu and Jeffrey Kuhn (2022), Academic Stars and Licensing Experience in University Technology Commercialization, Strategic Management Journal.
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Should Universities Try to Capture More Value from Their Research?

On average, universities in the U.S. capture 16% of the value they help create in the startups spawned by their research. Two new papers co-authored by Wharton’s David Hsu look at what academic institutions need to consider when it comes to commercializing their IP.…Read More

Knowledge at Wharton - 1/25/2021
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Hack to the Future
Wharton Magazine - 04/17/2020

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Headshot of Tanya Paul. She has short, dark hair and is wearing a khaki jacket over a pink shirt.How This Doctoral Student Began Her PhD Journey as a Wharton Undergrad

Getting a PhD wasn’t part of Tanya’s long-term plan when she started as an undergrad at Wharton. She initially aspired to work as a data scientist or analyst but soon fell in love with data in a whole different way through a research assistantship….

Wharton Stories - 09/07/2016
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