1. 1 Kauffman Firm Survey Tim Davis Entrepreneurship Indicators Project OECD ISTAT-Eurostat-OECD Seminar on Entrepreneurship Indicators Rome, December 6 and 7, 2006

2. Tim Davis, Statistics Directorate, OECD Background The Kauffman Foundation Large American Foundation Large American Foundation Based in Kansas City, USA Based in Kansas City, USA Established by Ewing Kauffman: Successful entrepreneur Established by Ewing Kauffman: Successful entrepreneur Missions: - Advancing Entrepreneurship Missions: - Advancing Entrepreneurship - Improving education of children & youth Strong supporter of entrepreneurship research and data Strong supporter of entrepreneurship research and data Headed by Carl Schramm Headed by Carl Schramm Recent new entrepreneurship book by Schramm: Recent new entrepreneurship book by Schramm: The Entrepreneurial Imperative: How Americas Economic Miracle Will Reshape the World (and change your life)

3. Tim Davis, Statistics Directorate, OECD The Kauffman Firm Survey Purposes of the Survey Understand challenges of owning/operating a new business Understand challenges of owning/operating a new business Understand the factors of success for businesses Understand the factors of success for businesses Focus on financial development during first four years Focus on financial development during first four years Characteristics of business and owners as well as detailed information on financing of start-up and operations Characteristics of business and owners as well as detailed information on financing of start-up and operations Inform policy decisions and academic research Inform policy decisions and academic research Create a publicly-available data set Create a publicly-available data set

4. Tim Davis, Statistics Directorate, OECD Methodology Longitudinal survey Longitudinal survey Target population New businesses started in 2004; still operating New businesses started in 2004; still operating Not a Branch, subsidiary or inherited Not a Branch, subsidiary or inherited Excludes not-for-profits Excludes not-for-profits Must locate original entrepreneur Must locate original entrepreneur Interview terminates if original entrepreneur not available Interview terminates if original entrepreneur not available

5. Tim Davis, Statistics Directorate, OECD Methodology Sample : Sample : - 5,000 companies; From Dun and Bradstreet list - Over sampled High Tech(3,000 firms) Numerous screening questions to ensure eligibility Numerous screening questions to ensure eligibility Questions Re: taxes, administrative and legal status Questions Re: taxes, administrative and legal status Total of ~90 Questions Total of ~90 Questions Includes interviewer flow questions Includes interviewer flow questions KFS poses questions for EACH owner KFS poses questions for EACH owner

6. Tim Davis, Statistics Directorate, OECD KFS: Questionnaire Modules Introduction/Identify original entrepreneur:10Q Eligibility Screening: 13Q Business Characteristics: 8Q Strategy and Innovation: 7Q Business Organisation and HR Benefits 3Q Business Finances31Q Work Behaviours and Demographics of Owners11Q Tracing or Follow-up Questions 7Q Information Obtained by Observations 1Q

7. Tim Davis, Statistics Directorate, OECD Comparison Categories: KFS vs. FoBS Methodology Entrepreneurs Profile Business Characteristics/Environment Business Strategy and Innovation Financials

8. Tim Davis, Statistics Directorate, OECD Methodology FeaturesKFSFoBS Number of questions ~90 questions ~32 questions Collection of Information CATI or Web survey CATI or Web survey Incentive: $ 50 Incentive: $ 50 Paper Survey (?) Paper Survey (?) CoverageUSA 13 EU members + 2 acceding countries Sample size 5000 (3000 high tech) Varies by country Survey Frame Dun and Bradstreet National Business Registers

9. Tim Davis, Statistics Directorate, OECD Entrepreneurs Profile KFSFoBS Salary or Position Original entrepreneur? Paid employee? Avg hours worked Original entrepreneur? Other paid job? Age, Sex, Citizenship, Yes + Race, Born in the USA ; Citizen = USA vs. other Yes + Country of residence MotivationNoYes Previous experience Yes (3 questions) Yes (2 questions) Previous situation NoYes SupportNo Training; Sources of advice EducationYesYes

10. Tim Davis, Statistics Directorate, OECD Business Characteristics/Environment KFSFoBS Number employees In 2004 + full/part time At start-up and in 2004 + paid/unpaid Number owners +active owners Yes How is firm managed today Customers Sales by client type No of customers Competition Licensing in/out Relations within industry Difficulties?No -Difficulties on start-up -Impediments to sales and development

11. Tim Davis, Statistics Directorate, OECD Business Characteristics/Environment KFSFoBS Type of start-up YesYes Product vs. service Yes No No Type of business location YesNo Extent of Market NoYes Employees by function 7 Function groups No Employee Benefits YesNo

12. Tim Davis, Statistics Directorate, OECD Business Strategy and Innovation KFSFoBS Product vs. service Yes No No Innovation Competitive advantages, Patents, Licensing, etc Innovation Future plans Will business move? Yes (3) Web site YesNo

13. Tim Davis, Statistics Directorate, OECD Financials KFS: 26 Questions FoBS: 3 Questions Source of funding Angel, Loans, Venture Capital, Owners + amounts, proportions Angel, Loans, Venture Capital, Owners Financial Structure Equity, Debt Options, Trade Financing No Revenues / Expenses Detailed amounts Detailed amounts Total profit/loss Total profit/loss Wages, salaries, benefits Wages, salaries, benefits Machinery, equipment Machinery, equipment R&D R&D Turnover Turnover Judge profitability Judge profitability Assets / Liabilities Types and values No

14. Tim Davis, Statistics Directorate, OECD KFS Financials Did owners money buy shares? How much? How many? Did owners money buy shares? How much? How many? How much equity from each source? How much equity from each source? Ownership share for each equity source? Ownership share for each equity source? Owners use of debt sources? Which sources? Owners use of debt sources? Which sources? Credit line? Credit card balance? How often? Amount? Credit line? Credit card balance? How often? Amount? Business use of debt sources? Same questions… Business use of debt sources? Same questions… Amounts obtained by business from other debt sources Amounts obtained by business from other debt sources Did business purchase on account? (deferred payment) Did business purchase on account? (deferred payment) How much was purchased on account? How much was purchased on account?

15. Tim Davis, Statistics Directorate, OECD Survey Results KFS results, and analytical overview, expected in February 2007 KFS results, and analytical overview, expected in February 2007 Release through Kauffman Web Site and other channels Release through Kauffman Web Site and other channels Eurostat has published aggregated data on its Web Site Eurostat has published aggregated data on its Web Site Statistics in Focus Bulletin also published Statistics in Focus Bulletin also published