Our study extends a long-running debate into the domain of entrepreneurship by examining firm and industry effects on the performance of new ventures. We examine to what extent firm and industry levels explain sales, sales growth, and survival among 7,256 young Swedish firms over a five-year period, and compare these findings to a sample of 12,692 established firms. We found that the industry level ‘matters’ little for the survival of either sample of firms, and industry membership matters less for the sales and sales growth of new ventures than for established firms. Post hoc analysis revealed that size affects new venture performance, and that new venture funding is related to both sales and survival. At a broad level, our findings shed new light on the roles of the liabilities of newness and smallness for the performance of new ventures. Copyright © 2009 Strategic Management Society.