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How Business Opportunities Constrain Young Technology-Based Firms from Growing into Medium-Sized Firms

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  • Rögnvaldur Saemundsson
  • Åsa Dahlstrand

Abstract

This paper analyses how the novelty of business opportunities at start-up constrains young technology-based firms from attaining substantial growth and becoming medium-sized. Data from 262 young Swedish technologybased firms are used to estimate a logit regression model relating different types of opportunities to the probability of becoming medium-sized. The results show that firms which seek to exploit opportunities based on new market knowledge are less likely to attain substantial growth than firms that seek to exploit opportunities based on existing market knowledge. The former class of firms can nevertheless increase the probability of such growth by actively seeking external financing. Copyright Springer 2005

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  • Rögnvaldur Saemundsson & Åsa Dahlstrand, 2005. "How Business Opportunities Constrain Young Technology-Based Firms from Growing into Medium-Sized Firms," Small Business Economics, Springer, vol. 24(2), pages 113-129, March.
    • Handle: RePEc:kap:sbusec:v:24:y:2005:i:2:p:113-129
    DOI: 10.1007/s11187-003-3803-6
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    References listed on IDEAS

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    1. Delmar, Frederic & Davidsson, Per & Gartner, William B., 2003. "Arriving at the high-growth firm," Journal of Business Venturing, Elsevier, vol. 18(2), pages 189-216, March.
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    Cited by:

    1. Petra Andries & Koenraad Debackere, 2007. "Adaptation and Performance in New Businesses: Understanding the Moderating Effects of Independence and Industry," Small Business Economics, Springer, vol. 29(1), pages 81-99, June.
    2. Gerrit de Wit & Haibo Zhou, 2009. "Determinants and dimensions of firm growth," Scales Research Reports H200903, EIM Business and Policy Research.
    3. Desislava Ivanova Yordanova, 2011. "Growth Plans of Bulgarian Enterprises: An Empirical Investigation of Individual, Organizational and Environmental Influences," International Journal of Finance, Insurance and Risk Management, International Journal of Finance, Insurance and Risk Management, vol. 1(1), pages 1-30.
    4. Vivek Ghosal & Yang Ye, 2013. "Business Decision-Making under Uncertainty: Evidence from Employment and Number of Businesses," CESifo Working Paper Series 4312, CESifo.
    5. Vivek Ghosal & Yang Ye, 2015. "Uncertainty and the employment dynamics of small and large businesses," Small Business Economics, Springer, vol. 44(3), pages 529-558, March.
    6. Candi, Marina & Kitagawa, Fumi, 2022. "Performance implications of business model centrality over technology-based firms’ life courses," Technovation, Elsevier, vol. 118(C).
    7. Lee, Lena & Wong, Poh Kam, 2006. "How does An Entrepreneur’s Ability Influence the Propensity to Exploit Novel Opportunities? The Moderating Role of Personality and Environment," MPRA Paper 597, University Library of Munich, Germany.
    8. Lee, Lena & Wong, Poh Kam, 2009. "Novel Opportunity Exploitation: Impact of Personality, Environment and Uncertainty Avoidance Culture," MPRA Paper 16194, University Library of Munich, Germany.
    9. Tristan Boyer & Régis Blazy, 2014. "Born to be alive? The survival of innovative and non-innovative French micro-start-ups," Small Business Economics, Springer, vol. 42(4), pages 669-683, April.
    10. Silvina A. Romano & Jon Mikel Zabala‐Iturriagagoitia, 2022. "Davids versus Goliaths: Epigenetic dynamics and structural change in the Swedish innovation system," Growth and Change, Wiley Blackwell, vol. 53(4), pages 1737-1761, December.
    11. Ganotakis, Panagiotis & D'Angelo, Alfredo & Konara, Palitha, 2021. "From latent to emergent entrepreneurship: The role of human capital in entrepreneurial founding teams and the effect of external knowledge spillovers for technology adoption," Technological Forecasting and Social Change, Elsevier, vol. 170(C).
    12. Hyytinen, Ari & Pajarinen, Mika & Rouvinen, Petri, 2015. "Does innovativeness reduce startup survival rates?," Journal of Business Venturing, Elsevier, vol. 30(4), pages 564-581.

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