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The Value of Patience and Start-up Firms: A Re-Examination of Entry Timing for Emerging Markets

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  • Linda F. Tegarden
  • Ann E. Echols
  • Donald E. Hatfield

Abstract

We investigate how changing technological and industry conditions in emerging markets, driven by product innovation, affect the exit rates of start-up versus established firms. We find that these changing conditions have different outcomes for start-up and established firms. We assert that the higher rates of exit for start-ups compared to established firms is due to start-up firms' lower ability to adapt both to technology and industry changes that occur with technological progress. We test this assertion by comparing the rate of exit of start-up firms to established firms that entered the U.S. personal computer market between 1975 and 1988.

Suggested Citation

  • Linda F. Tegarden & Ann E. Echols & Donald E. Hatfield, 2000. "The Value of Patience and Start-up Firms: A Re-Examination of Entry Timing for Emerging Markets," Entrepreneurship Theory and Practice, , vol. 24(4), pages 41-58, July.
    • Handle: RePEc:sae:entthe:v:24:y:2000:i:4:p:41-58
    DOI: 10.1177/104225870002400403
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    3. Carrillo-Hermosilla, Javier, 2006. "A policy approach to the environmental impacts of technological lock-in," Ecological Economics, Elsevier, vol. 58(4), pages 717-742, July.
    4. Wittfoth, Sven & Berger, Theo & Moehrle, Martin G., 2022. "Revisiting the innovation dynamics theory: How effectiveness- and efficiency-oriented process innovations accompany product innovations," Technovation, Elsevier, vol. 112(C).
    5. Camerani, Roberto & Corrocher, Nicoletta & Fontana, Roberto, 2020. "It's never too late (to enter)… till it is! Firms’ entry and exit in the digital audio player industry," Technological Forecasting and Social Change, Elsevier, vol. 153(C).

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