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Business Partners: Complementary Assets, Financing, and Invention Commercialization

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  • Thomas Åstebro
  • Carlos J. Serrano

Abstract

This paper assesses the relative importance of the complementary assets and financial capital that business partners may add to the original inventor‐entrepreneur. Projects run by partnerships were five times as likely to reach commercialization as those without business partners, and they had mean revenues approximately 10 times as great as projects run by solo entrepreneurs. These gross differences may be due both to partners impacting business success that is, who the particular partners were, and to selection of the type of project or of whom to select as a partner. After controlling for selection effects and observed/unobserved heterogeneity, the smallest estimate of partners' complementary assets approximately doubles the probability of commercialization and increases expected revenues by 29% at the sample mean. Our findings suggest that a critical policy option to increase commercialization rates and revenues for early‐stage businesses is to support the market for finding skilled partners.

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  • Thomas Åstebro & Carlos J. Serrano, 2015. "Business Partners: Complementary Assets, Financing, and Invention Commercialization," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 24(2), pages 228-252, June.
    • Handle: RePEc:bla:jemstr:v:24:y:2015:i:2:p:228-252
    DOI: 10.1111/jems.12095
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    1. Yin-Chi Huang & Shih-Kuan Chiu, 2017. "Procurement Situation Affects Performance - Adaptation And Complementary Assets As Moderate," International Journal of Business Research and Management (IJBRM), Computer Science Journals (CSC Journals), vol. 8(2), pages 13-30, June.
    2. Vojtech Bartos & Silvia Castro & Kristina Czura & Timm Opitz, 2023. "Gendered Access to Finance: The Role of Team Formation, Idea Quality, and Implementation Constraints in Business Evaluations," Rationality and Competition Discussion Paper Series 473, CRC TRR 190 Rationality and Competition.
    3. Jungho Lee, 2020. "Estimating the benefits and costs of forming business partnerships," RAND Journal of Economics, RAND Corporation, vol. 51(2), pages 531-562, June.
    4. Soonae Park & In Hyeock Lee & Jung Eun Kim, 2020. "Government support and small- and medium-sized enterprise (SME) performance: the moderating effects of diagnostic and support services," Asian Business & Management, Palgrave Macmillan, vol. 19(2), pages 213-238, April.
    5. Rønde, Thomas & Arora, Ashish & Fosfuri, Andrea, 2018. "Waiting for the payday? The market for startups and the timing of entrepreneurial exit," CEPR Discussion Papers 12724, C.E.P.R. Discussion Papers.
    6. Gordon K. Adomdza & Thomas Åstebro & Kevyn Yong, 2016. "Decision biases and entrepreneurial finance," Small Business Economics, Springer, vol. 47(4), pages 819-834, December.
    7. Stephane Lhuillery & Julio Raffo & Intan Hamdan-Livramento, 2016. "Measuring creativity: Learning from innovation measurement," WIPO Economic Research Working Papers 31, World Intellectual Property Organization - Economics and Statistics Division.
    8. Ashish Arora & Andrea Fosfuri & Thomas Rønde, 2021. "Waiting for the Payday? The Market for Startups and the Timing of Entrepreneurial Exit," Management Science, INFORMS, vol. 67(3), pages 1453-1467, March.
    9. Stock, Ruth Maria & von Hippel, Eric & Gillert, Nils Lennart, 2016. "Impacts of personality traits on consumer innovation success," Research Policy, Elsevier, vol. 45(4), pages 757-769.
    10. Carmen Cotei & Joseph Farhat & Indu Khurana, 2022. "The impact of policy uncertainty on the M&A exit of startup firms," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 46(1), pages 99-120, January.
    11. Sitnicki Maksym, 2018. "Exploration of the role of business schools in the development of world-class research universities," Technology audit and production reserves, 1(39) 2018, Socionet;Technology audit and production reserves, vol. 1(5(39)), pages 36-45.
    12. Berna Beyhan & Derya Fındık, 2022. "Selection of Sustainability Startups for Acceleration: How Prior Access to Financing and Team Features Influence Accelerators’ Selection Decisions," Sustainability, MDPI, vol. 14(4), pages 1-23, February.
    13. Rosendahl Huber, Laura & Sloof, Randolph & Van Praag, Mirjam & Parker, Simon C., 2020. "Diverse cognitive skills and team performance: A field experiment based on an entrepreneurship education program," Journal of Economic Behavior & Organization, Elsevier, vol. 177(C), pages 569-588.
    14. Thomas Hellmann & Noam Wasserman, 2017. "The First Deal: The Division of Founder Equity in New Ventures," Management Science, INFORMS, vol. 63(8), pages 2647-2666, August.
    15. Nicoletta Corrocher & Camilla Lenzi, 2022. "Exploring the sources of knowledge diversity in founding teams and its impact on new firms’ innovation," Journal of Evolutionary Economics, Springer, vol. 32(4), pages 1091-1118, September.

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