Defining the Relationship among Founding Resources, Strategies, and Performance in Technology-Intensive New Ventures: Evidence from the Semiconductor Silicon Industry*


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    Earlier versions of this paper were published in the 2005 Academy of Management Best Paper Proceedings and the 2004 United States Association for Small Business and Entrepreneurship Annual Conference Proceedings.

Scott L. Newbert, Villanova School of Business, Villanova University, 800 Lancaster Avenue, Villanova, PA 19085, USA. Tel: 610-519-5440. E-mail:


The degree to which a firm's performance is dependent on its resources and strategies is widely debated in the literature. We examine this issue by analyzing historical data on the entire population of new independent firms started worldwide in the semiconductor silicon industry for the first 50 years of its existence. We measure resources (managerial capabilities and technological competencies) and strategies (emphasis on demand pull or technology push) at the time of founding and test their relationship with each other as well as with multiple measures of performance (lifespan and best year's sales). We find that firms founded on managerial capabilities emphasize demand-pull strategies at founding, whereas firms founded upon technological competencies emphasize technology-push strategies at founding. We also find that firms emphasizing technology-push strategies perform better than firms emphasizing demand-pull strategies. Lastly, we find that though managerial capabilities are related to a firm's best year's sales, this relationship is mediated by the firm's founding strategy.