*The authors want to thank the participants of the 2004 Babson-Kaufmann Entrepreneurship Conference and the 2004 Academy of Management Conference for their constructive comments. A previous version of this article won the 2004 Irene McCarthy Award for best article on high technology at BKERC. We also want to thank the participants of the research seminars at Massachusetts Institute of Technology Sloan School of Management, Ghent University and Vlerick Leuven Gent Management School, and two anonymous reviewers for their helpful comments on earlier drafts. All errors are our own. Financial support of the Flemish government (Steunpunt Ondernemerschap, Ondernemingen en Innovatie) is gratefully acknowledged.
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Which Tangible and Intangible Assets Matter for Innovation Speed in Start-Ups?†
Article first published online: 18 JUN 2007
DOI: 10.1111/j.1540-5885.2007.00253.x
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How to Cite
Heirman, A. and Clarysse, B. (2007), Which Tangible and Intangible Assets Matter for Innovation Speed in Start-Ups?. Journal of Product Innovation Management, 24: 303–315. doi: 10.1111/j.1540-5885.2007.00253.x
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Publication History
- Issue published online: 18 JUN 2007
- Article first published online: 18 JUN 2007
- Abstract
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The launch of the first product is an important event for start-ups, because it takes the new venture closer to growth, profitability, and financial independence. The new product development (NPD) literature mainly focuses its attention on NPD processes in large firms. In this article insights on the antecedents on innovation speed in large firms are combined with resource-based theory and insights from the entrepreneurship literature to develop hypotheses concerning the antecedents of innovation speed in start-ups. In particular, tangible assets such as starting capital and the stage of product development at founding and intangible assets such as team tenure, experience of founders, and collaborations with third parties are considered as important antecedents for innovation speed in start-ups. A unique data set on research-based start-ups (RBSUs) was collected, and event-history analyses were used to test the hypotheses. The rich qualitative data on the individual companies are used to explain the statistical findings. This article shows that RBSUs differ significantly in their starting conditions. The impact of starting conditions on innovation speed differs between software and other companies. Although intuition suggests that start-ups that are further in the product development cycle at founding launch their first product faster, our data indicate that software firms starting with a beta version experience slower product launch. The amount of initial financing has no significant effect on innovation speed. Next, it is shown that team tenure and experience of founders leads to faster product launch. Contrary to expectations, alliances with other firms do not significantly affect innovation speed, and collaborations with universities are associated with longer development times.