Research

Abstract. While management research traditionally views corporate owners as governance actors, recent work suggests they also drive complex organizational change that requires distinct capabilities to implement. I investigate how owners implement their strategy across portfolio firms by examining employee mobility within private equity portfolios. Using career history and work activity data for over 8.7 million employees across 12,775 firms receiving first-ever private equity investment in 2001-2021, I document three findings. First, following investment, portfolio firms increase hiring from their new owner’s prior portfolio firms, particularly into managerial, finance, and operations roles. Second, this common-owner hiring is more prevalent under owners who emphasize strategic growth, and less prevalent under those focused on financial engineering. Third, a firm’s organizational focus converges toward that of other firms in the same portfolio after investment, but primarily when the firm also hires common-owner employees. These findings indicate a relational mechanism through which owners shape firms: they build a network of trusted talent and deploy it into new portfolio firms to implement their owner-specific strategy.

Abstract. How do firms balance market competitiveness with internal cohesion when setting employee pay? We examine this question using confidential compensation data on 19 million U.S. employees across 479 firms varying in knowledge intensity. We construct precise pay reference groups: internal benchmarks based on skill-equivalent peers across functions and market benchmarks based on same occupation, skill level, and region at other firms. We find that, in low knowledge-intensity firms, pay is equally sensitive to both internal and market benchmarks, while in high knowledge-intensity firms, pay becomes decoupled from market forces and aligns with internal benchmarks. Internal pay alignment also increases following CEO transitions that prioritize innovation. These patterns are driven by high-skilled employees in roles requiring complex problem-solving and collaboration. Moreover, firms with greater internal pay alignment generate more patents, including breakthrough innovations. Altogether, our findings reveal that, while some firms maintain close market alignment, knowledge-intensive firms appear to decouple pay from market forces. This is particularly the case for their skilled workers, consistent with firms prioritizing internal social dynamics in contexts where complex problem-solving and collaboration are important for value creation.

Abstract. The rise of active owners—hedge funds and private equity firms—has raised questions about the influence of corporate owners on employee compensation. Prior research documents that active owners reduce overall compensation through workforce restructuring and slower wage growth. What remains unexplored is whether active owners also pay less for comparable work: whether they compensate the same jobs differently than other owners. Using detailed compensation from over 20 million employee records across 896 U.S. firms, we compare pay within narrowly defined labor markets that hold constant year, region, occupation, and skill level. We find that firms with active owners pay 2 to 4% less for comparable work than other firms. These differentials manifest both as lower base salary and flatter incentive pay, and appear to reflect, at least in part, an owner treatment effect. Notably, the effects are concentrated in more monitorable contexts, including routine jobs, jobs with quantifiable outputs, and those in less knowledge-intensive industries. These patterns are consistent with active owners substituting compensation-based incentives with managerial oversight, particularly in quantifiable and routine settings. This suggests that, as work becomes more measurable, firm ownership may play a greater role in shaping employee outcomes. 

Abstract. Firms' access to talent depends on workers' willingness to relocate, yet little is known about how ideological incongruence between a firm's location and workers constrains mobility. We propose that state-level regulatory changes signal prevailing ideologies, creating frictions for workers whose values conflict with those signals. We analyze job applications to technology startups around the overturning of Roe v. Wade, which triggered abortion bans in certain states. Applications to in-person jobs in these states fell relative to those retaining protections, while applications to remote jobs were unaffected. Analyses by applicant and location attributes suggest value misalignment as the primary driver. Firms offered higher pay to sustain applicant interest following the ruling. Our findings indicate that both remote work and compensation can mitigate value-based mobility frictions.

Abstract. Venture capital (VC) investors provide startups with financial and strategic resources, yet their role in facilitating talent acquisition remains under-explored. We examine talent flows among startups within a VC’s portfolio network. Using individual career history data for 24,006 U.S. VC-backed startups (2000-2022), we document that a significant share of new hires hail from the investor’s own portfolio. These talent flows are strategically timed: departures to peer startups occur primarily when the source firm exits the portfolio through failure, acquisition, or IPO. Leveraging quasi-exogenous variation from staggered changes in conflict-of-interest laws, we find that such portfolio-based hiring significantly improves startup survival, growth, and exit outcomes. Together, these findings imply that VCs help improve startup performance by facilitating the inter-temporal redeployment of human resources from retiring holdings to more active ones.