MIT Entrepreneurship Center - History of Entrepreneurship at MIT

HISTORY OF ENTREPRENEURSHIP AT MIT

Beginning with the founding of Arthur D. Little, Inc. in Cambridge in 1886, MIT alumni, faculty, and students have played key roles in launching thousands of companies worldwide, ranging from small, specialized high-tech operations to corporate giants such as Genentech, Gillette, Hewlett-Packard, Teradyne, and Raytheon. Many of these companies have formed the cornerstone of new industries, including biotechnology, streamlined digital technologies, local computer networks, defense, semi-conductors, minicomputers, advanced computers, and venture capital. MIT scientists and entrepreneurs laid the groundwork for much of the current biotech industry - and biomedical advances have continued with MIT-originated developments such as the first effective new treatment for brain cancer in a generation. The MIT Technology Licensing Office (TLO) has more than 1,000 issued US patents in its portfolio, many with foreign counterparts. Each year, the TLO annually grants as many as 60-80 licensing agreements.

The unmatched record of achievement of MIT-educated entrepreneurs is described in a recent study, "Entrepreneurial Impact: The Role of MIT". It estimates that 25,600 companies founded or co-founded by living MIT alumni were still in existence in 2006, employing 3.3 million people worldwide and generating revenues of close to $2 trillion. That would make the ensemble of MIT-alumni companies the equivalent in GDP of the 11th largest economy in the world. And MIT's impact extends far beyond the borders of Massachusetts, which headquarters MIT-alumni companies that employ about one million women and men. The report estimates that California firms started by MIT alumni employ over 500 thousand people, and twenty states have over 10,000 people employed by MIT entrepreneurs. This impact is global as well, with half of the foreign-student MIT-alumni entrepreneurs likely to return to their home countries.

Table 1 is drawn from that report, illustrating some of the larger firms founded by MIT alumni.

Table 1. Examples of Important MIT Alumni-Founded Companies (ordered by $ sales*)

Company	Location	Employment (Thousands)	Sales (Millions)	MIT Founder	MIT Class	Founded
Koch Industries	Wichita KA	80	$110,000	Charles Koch	1957	1967 (consolidation)
Koch Industries	Wichita KA	80	$110,000	David Koch	1962	1967 (consolidation)
Intel Corporation	Santa Clara CA	86	38,300	Robert Noyce	1954	1968
Hewlett-Packard	Palo Alto CA	156	22,600	William Hewlett	1936	1939
Raytheon Co.	Lexington MA	72	21,300	Vannevar Bush	1916	1922
McDonnell Douglas	St. Louis MO	70	14,470	James McDonnell Jr.	1925	1939
Texas Instruments	Dallas TX	30	13,830	Cecil Green	1923	1930
Digital Equipment Corp. (DEC)	Maynard MA	140	13,000 (in 1997)	Kenneth Olsen	1950	1957
Digital Equipment Corp. (DEC)	Maynard MA	140	13,000 (in 1997)	Harlan Anderson	1953	1957
Genentech	San Francisco CA	12	11,724	Robert Swanson	1970	1976
Qualcomm Inc.	San Diego CA	13	9,800	Irwin Jacobs	1959	1985
ThermoElectron	Waltham MA	30	9,000	George Hatsopoulos	1949	1956
Synnex Corp.	Fremont, CA	3	6,344	Robert Huang	1979	1980
America Online	Dulles VA	15	6,110	Marc Seriff	1973	2001
Symantec Corp.	Cupertino CA	16	4,143	Denis Coleman	1968	1982
Analog Devices	Norwood MA	9	2,570	Ray Stata	1957	1965
Analog Devices	Norwood MA	9	2,570	Matthew Lorber	1957	1965
Gillette	Boston MA	29	2250 (in 2003)	William Emery Nickerson	1876	1901
Bose Corp.	Framingham MA	10	2,000	Amar Bose	1956	1964
Teradyne	Boston MA	4	1,600	Alex d'Arbeloff,	1949	1960
Teradyne	Boston MA	4	1,600	Nick DeWolf	1949	1960
International Data Group (IDG)	Boston MA	13	1,520	Patrick McGovern	1959	1964
E*Trade Group	New York NY	4	1,400	William Porter	1967	1991
3Com Corporation	Marlborough MA	6	1,300	Robert Metcalfe	1969	1979
Sepracor	Marlborough MA	2	1,225	Robert Bratzler	1975	1984
Avid Technology	Tewksbury MA	1	930	Bill Warner	1980	1987
VMware Inc.	Palo Alto CA	3	704	Diane Greene	1978	1998
Akamai	Cambridge, MA	1	636	Tom Leighton,	1981	1998
				Jonathan Seelig,	1998
				Preetish Nijhawan	1998
Patni Computer Systems Ltd.	Mumbai, India	13	579	Naren Patni	1966	1978
Millennium Pharmaceuticals	Cambridge MA	1	527	Eric Lander	1986	1993
Medical Information Technology	Westwood MA	3	400	Neil Pappalardo,	1961	1969
				Edward Roberts,	1957
				Curtis Marble,	1961
				Jerome Grossman	1962
iRobot Corp.	Burlington MA	1	249	Colin Angle,	1989	1990
iRobot Corp.	Burlington MA	1	249	Helen Greiner	1990	1990
The Math Works	Natick MA	2	230	Jack Little	1978	1984

* All sales and employment data are from 2006 or the most recent year available prior to 2006, and are rounded off to the nearest whole number.

In the 1940s, MIT President Karl Taylor Compton, working with members of the local business community, conceived the idea of a high-tech venture capital firm to help nurture the development of companies springing up in the region. This work led to the founding of the first modern venture capital company, American Research and Development (ARD), in 1946.

	MIT Entrepreneurship Center, One Amherst Street, E40-196, Cambridge, MA 02142 Tel: +1-617-253-8653, Fax: +1-617-253-8633, Email: ecenter@mit.edu

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