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Corporate Venture Capital, Disembodied Experimentation and Capability Development

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  • Thomas Keil
  • Erkko Autio
  • Gerard George

Abstract

Studies invoking a capabilities lens often ascribe deliberateness in organizational decisions to develop new capabilities. Drawing on five longitudinal case studies of large, global firms in the information and communication technology sector, we examine how firms engender cognizance of their future capability needs in situations characterized by high decision‐making uncertainty. We develop a theoretical account of how firms use investments in start‐ups to actively engage in experimentation outside organizational boundaries, a learning process which we term as disembodied experimentation. Disembodied experimentation creates awareness of voids in the capability base of an incumbent and helps to overcome inertial restraints thereby influencing the decision to invest in capability development. The relationship between learning from disembodied experimentation and the decision to develop capabilities is moderated by knowledge brokering functions and adaptation complexity.

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  • Thomas Keil & Erkko Autio & Gerard George, 2008. "Corporate Venture Capital, Disembodied Experimentation and Capability Development," Journal of Management Studies, Wiley Blackwell, vol. 45(8), pages 1475-1505, December.
    • Handle: RePEc:bla:jomstd:v:45:y:2008:i:8:p:1475-1505
    DOI: 10.1111/j.1467-6486.2008.00806.x
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    4. Shuwaikh, Fatima & Dubocage, Emmanuelle, 2022. "Access to the Corporate Investors' Complementary Resources: A Leverage for Innovation in Biotech Venture Capital-Backed Companies," Technological Forecasting and Social Change, Elsevier, vol. 175(C).
    5. Varkey Titus Jr. & Owen Parker & Jeffrey Covin, 2020. "Organizational Aspirations and External Venturing: The Contingency of Entrepreneurial Orientation," Entrepreneurship Theory and Practice, , vol. 44(4), pages 645-670, July.
    6. Riikkinen, Mikko & Pihlajamaa, Matti, 2022. "Achieving a strategic fit in fintech collaboration – A case study of Nordea Bank," Journal of Business Research, Elsevier, vol. 152(C), pages 461-472.
    7. Gideon D. Markman & Donald S. Siegel & Mike Wright, 2008. "Research and Technology Commercialization," Journal of Management Studies, Wiley Blackwell, vol. 45(8), pages 1401-1423, December.
    8. Markku V. J. Maula & Thomas Keil & Shaker A. Zahra, 2013. "Top Management’s Attention to Discontinuous Technological Change: Corporate Venture Capital as an Alert Mechanism," Organization Science, INFORMS, vol. 24(3), pages 926-947, June.
    9. Enkel, Ellen & Sagmeister, Veronika, 2020. "External corporate venturing modes as new way to develop dynamic capabilities," Technovation, Elsevier, vol. 96.
    10. Gustafsson, Robin & Autio, Erkko, 2011. "A failure trichotomy in knowledge exploration and exploitation," Research Policy, Elsevier, vol. 40(6), pages 819-831, July.
    11. Deryck J Van Rensburg, 2015. "The Promise of Corporate Entrepreneurship: A Review of Data Analytic Strategies," Business and Management Research, Business and Management Research, Sciedu Press, vol. 4(1), pages 59-73, March.
    12. Matteo Rossi & Giuseppe Festa & Ludovico Solima & Simona Popa, 2017. "Financing knowledge-intensive enterprises: evidence from CVCs in the US," The Journal of Technology Transfer, Springer, vol. 42(2), pages 338-353, April.
    13. Maula, Markku V.J. & Autio, Erkko & Murray, Gordon C., 2009. "Corporate venture capital and the balance of risks and rewards for portfolio companies," Journal of Business Venturing, Elsevier, vol. 24(3), pages 274-286, May.
    14. Marcela Ramírez‐Pasillas & Hans Lundberg & Mattias Nordqvist, 2021. "Next Generation External Venturing Practices in Family Owned Businesses," Journal of Management Studies, Wiley Blackwell, vol. 58(1), pages 63-103, January.
    15. Kamel Mellahi & Adrian Wilkinson, 2010. "A Study of the Association between Level of Slack Reduction Following Downsizing and Innovation Output," Journal of Management Studies, Wiley Blackwell, vol. 47(3), pages 483-508, May.
    16. Steven Rottmann, 2019. "Corporate Venturing Evaluation: How Start-Up Performance is Measured in Corporate Venturing During the Collaboration Phase," European Journal of Business Science and Technology, Mendel University in Brno, Faculty of Business and Economics, vol. 5(2), pages 185-199.
    17. Kalm, Matias, 2012. "The Impact of Networking on Firm Performance - Evidence from Small and Medium-Sized Firms in Emerging Technology Areas," Discussion Papers 1278, The Research Institute of the Finnish Economy.
    18. Jeon, Euiju & Maula, Markku, 2022. "Progress toward understanding tensions in corporate venture capital: A systematic review," Journal of Business Venturing, Elsevier, vol. 37(4).
    19. David Bendig & Simon Hensellek & Julian Schulte, 2024. "Beneficial, Harmful, or Both? Effects of Corporate Venture Capital and Alliance Activity on Product Recalls," Entrepreneurship Theory and Practice, , vol. 48(1), pages 35-70, January.
    20. Varkey K. Titus Jr. & Brian S. Anderson, 2018. "Firm Structure and Environment as Contingencies to the Corporate Venture Capital-Parent Firm Value Relationship," Entrepreneurship Theory and Practice, , vol. 42(3), pages 498-522, May.
    21. Øyna, Stine & Almor, Tamar & Elango, B. & Tarba, Shlomo Y., 2018. "Maturing born globals and their acquisitive behaviour," International Business Review, Elsevier, vol. 27(3), pages 714-725.
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