Talent Acquisition and Technology Leadership: A Study of Digital Platforms

This paper traces inventors from firms acquired by Big Tech platforms and identifies those who continue to innovate for the acquiring firm after the transaction. Using matched firm-level data and patent records, we show that inventors whose pre-acquisition work lies closer to the acquirer’s core technological domains are more likely to remain active innovators within the acquirer. We then explore potential mechanisms underlying this pattern. First, we find that inventors specialized in core technologies are easier for acquirers to evaluate ex ante, which may partly explain their higher post-acquisition retention. Yet, once integrated, these highly skilled core inventors are frequently redirected away from the acquirer’s core technological fields. Taken together, our results suggest that Big Tech primarily acquires core-technology inventors because their value is easier to assess, not necessarily to keep them focused on those core areas.