New ventures' inward licensing: examining the effects of industry and strategy characteristics

  1. Shaker A Zahra1,*,
  2. Thomas Keil2,
  3. Markku Maula3

Article first published online: 13 DEC 2010

DOI: 10.1057/palgrave.emr.1500042

Issue

European Management Review

European Management Review

Volume 2, Issue 3, pages 154–166, Winter 2005

Additional Information

How to Cite

Zahra, S. A., Keil, T. and Maula, M. (2005), New ventures' inward licensing: examining the effects of industry and strategy characteristics. European Management Review, 2: 154–166. doi: 10.1057/palgrave.emr.1500042

Author Information

  1. 1

    University of Minnesota, Minneapolis, USA

  2. 2

    York University, Toronto, Canada

  3. 3

    Helsinki University of Technology, Helsinki, Finland

*Center for Entrepreneurial Studies, Department of Strategic Management & Organization, Carlson School of Management, University of Minnesota, Room 3–428, 321 19th Ave. South, Minneapolis, MN 55455, USA. Tel: +1 612 626 6623; Fax: +1 612 626 1316; E-mail: szahra@csom.umn.edu

Publication History

  1. Issue published online: 13 DEC 2010
  2. Article first published online: 13 DEC 2010

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Keywords:

  • new venture;
  • technological capabilities;
  • inward licensing

Abstract

New ventures compete by creating innovative products. Liabilities of newness and inexperience, limited resources, rapid technological obsolescence and constantly changing market conditions often encourage new ventures to license other companies' technologies to complement and augment their internally developed innovations. Building on the knowledge-based view of the firm, we propose that the intensity of new ventures' use of inward licensing reflects the demands of their industries and competitive strategies. The results of an empirical study of 361 US new ventures show that industry characteristics and competitive strategy influence their inward licensing as a means of lowering costs and maintaining strategic flexibility while building their capabilities.

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