In releasing it recommendations for reviving the moribund IPO market, the National Venture Capital Association also revealed an interesting stat.
The NVCA estimates that in 2008 public companies that were once venture backed accounted for more than 12 million U.S. jobs and $2.9 trillion in revenues, according to a report to be released in early May by Global Insight. That equates to 21% of U.S. GDP.
That’s quite a jump in three years. Last time Global Insight did a similar report, it estimated that U.S. companies that received venture capital from 1970-2005 accounted for 10 million jobs and $2.1 trillion in revenues in 2005.
So, where did those 2 million jobs and $800 billion in GDP come from over three years? It’s a bit of a head-scratcher, given that lately the economy has been shedding jobs, and tech titans that got their start with venture funding have contributed their share to the layoff numbers. I’m waiting to hear back from Global Insight regarding the main contributors to job growth.
Meanwhile, I’m somewhat stumped. Sure, there are new employers. Facebook and other Web 2.0 up-and-comers probably collectively employ some tens of thousands, for example. And cleantech companies have been ramping up. But it’s hard to count a couple million jobs.