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How and Why Do Firms Differ at Start-Up? A Resource-Based Configurational Perspective

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Author Info
A. HEIRMAN ()
B.T CLARYSSE ()
V. VAN DEN HAUTE

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Abstract

This paper studies what initial resource endowments new organizations assemble and the interaction between initial resources, entrepreneurial orientation and environmental factors. More specifically, we study the initial resources of research-based start-ups (RBSUs), which are defined as new firms that develop and market new products or services based upon a proprietary technology or skill. Using a unique hand-collected dataset of RBSUs in Belgium, we empirically test how technological, financial and human resources relate to each other to form distinct starting resource configurations. We find four different types of starting configurations: “Venture Capital-backed start-ups,” “Prospectors,” “Product start-ups” and “Transitional start-ups”. This study shows that these different types of starting resource configurations are not only empirically distinct but can also be conceptually explained by internal factors such as the entrepreneurial orientation at start-up and external factors such as the origin of the firm and the characteristics of the industry in which the firm competes.

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Publisher Info
Paper provided by Ghent University, Faculty of Economics and Business Administration in its series Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium with number 03/198.

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Length: 50 pages
Date of creation: Sep 2003
Date of revision:
Handle: RePEc:rug:rugwps:03/198

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Related research
Keywords: innovation; resource configuration; resource-based view; start-ups;

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Birley, Sue & Westhead, Paul, 1994. "A taxonomy of business start-up reasons and their impact on firm growth and size," Journal of Business Venturing, Elsevier, vol. 9(1), pages 7-31, January. [Downloadable!] (restricted)
  2. Rebecca Henderson, 1993. "Underinvestment and Incompetence as Responses to Radical Innovation: Evidence from the Photolithographic Alignment Equipment Industry," RAND Journal of Economics, The RAND Corporation, vol. 24(2), pages 248-270, Summer. [Downloadable!] (restricted)
  3. Cantwell, John & Iammarino, Simona, 2001. "EU Regions and Multinational Corporations: Change, Stability and Strengthening of Technological Comparative Advantages," Industrial and Corporate Change, Oxford University Press, vol. 10(4), pages 1007-37, December.
  4. Tain-Jy Chen, 2003. "Network Resources for Internationalization: The Case of Taiwan's Electronics Firms," Journal of Management Studies, Blackwell Publishing, vol. 40(5), pages 1107-1130, 07. [Downloadable!] (restricted)
  5. Thomas Hellmann & Manju Puri, 2002. "Venture Capital and the Professionalization of Start-Up Firms: Empirical Evidence," Journal of Finance, American Finance Association, vol. 57(1), pages 169-197, 02. [Downloadable!] (restricted)
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  6. Chandler, Gaylen N. & Hanks, Steven H., 1998. "An examination of the substitutability of founders human and financial capital in emerging business ventures," Journal of Business Venturing, Elsevier, vol. 13(5), pages 353-369, September. [Downloadable!] (restricted)
  7. Macmillan, Ian C. & Siegel, Robin & Narasimha, P. N. Subba, 1985. "Criteria used by venture capitalists to evaluate new venture proposals," Journal of Business Venturing, Elsevier, vol. 1(1), pages 119-128. [Downloadable!] (restricted)
  8. David, Paul A, 1985. "Clio and the Economics of QWERTY," American Economic Review, American Economic Association, vol. 75(2), pages 332-37, May. [Downloadable!] (restricted)
  9. Lockett, Andy & Wright, Mike & Franklin, Stephen, 2003. " Technology Transfer and Universities' Spin-Out Strategies," Small Business Economics, Springer, vol. 20(2), pages 185-200, March. [Downloadable!] (restricted)
  10. Storey, D. J. & Tether, B. S., 1998. "Public policy measures to support new technology-based firms in the European Union," Research Policy, Elsevier, vol. 26(9), pages 1037-1057, April. [Downloadable!] (restricted)
  11. Thomas Hatzichronoglou, 1997. "Revision of the High-Technology Sector and Product Classification," OECD Science, Technology and Industry Working Papers 1997/2, OECD, Directorate for Science, Technology and Industry. [Downloadable!]
  12. G. Page West III, 2001. "The Achilles Heel of Firm Strategy: Resource Weaknesses and Distinctive Inadequacies," Journal of Management Studies, Blackwell Publishing, vol. 38(3), pages 417-442, 05. [Downloadable!] (restricted)
  13. Hellmann, Thomas & Puri, Manju, 2000. "The Interaction between Product Market and Financing Strategy: The Role of Venture Capital," Review of Financial Studies, Oxford University Press for Society for Financial Studies, vol. 13(4), pages 959-84.
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Oliver Hugo & Elizabeth Garnsey, 2005. "Problem-solving and competence creation in the early development of new firms," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 26(2), pages 139-148. [Downloadable!]
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