Balancing knowledge and power: Founder characteristics and the innovation strategies of Chinese technology-based enterprises

Enterprise founders play a pivotal role in shaping corporate innovation. Their technical expertise and political connections influence their innovation preferences and subsequent strategic decisions. Using panel data on listed companies on China’s Growth Enterprise Market from 2012 to 2023, this study examines how founders’ characteristics and power concentration affect firm innovation under different technology trajectories. The results show that founders with technical expertise generally promote innovation, while those with political connections tend to suppress it. These associations appear less pronounced in firms with highly concentrated founder power, and they differ systematically across technological trajectories. By integrating the dimensions of founder characteristics, power, and technology trajectory, the study clarifies how founders shape innovation outcomes in technology-based enterprises and extends the existing theoretical framework. The findings have practical implications for corporate governance and policy design. They suggest that internal governance structures shape how founder characteristics are reflected in firms’ innovation strategies, and that policymakers should foster an innovation-friendly institutional environment that reduces reliance on political capital and supports technology-driven growth.