Number of young U.S. technology companies falls: report - Reuters
Sluggish growth among young technology firms could bode trouble for the U.S. economy, according to a new report from the Kauffman Foundation, reports Reuters. The number of technology firms aged five years or younger - key drivers of job creation - has fallen to below 80,000, down from a high of 113,000 in 2001, according to the report. Today's levels are roughly on par with the mid-1990s. Factors that could help account for the drop include a tendency of older technology companies to acquire increasingly younger technology firms, taking them out of the pool of young companies prematurely, said report co-author Ian Hathaway in a telephone interview. For example, when Facebook acquired Instagram in 2012 for US$1 billion, it was just 2 years old. Separately, many old-line Silicon Valley companies buy start-ups simply to acquire their talented engineers in a phenomenon that has become known as the "acquihire."
