Drawing on 180 survey responses from young, New Zealand-based ventures, we investigate effects of the number of perceived serious competitors on venture growth. We find empirical evidence for an inverse U-shaped relationship between competitive density and young venture growth. We further find that persistent innovation – requiring both initial innovative intent and a recent record of innovation – not only promotes young growth but also moderates the relationship between competitive density and young venture growth. Overall, the study shows that the growth of young ventures committed to persistent innovation is less affected by competitive dynamics compared to non-innovators.
AldrichHEFiolCM (1994) Fools rush in? The institutional context of industry creation. Academy of Management Review19: 645–670.
2.
AldrichHEMartinezMA (2001) Many are called, but few are chosen: An evolutionary perspective for the study of entrepreneurship. Entrepreneurship Theory and Practice25: 41–56.
3.
AngSH (2008) Competitive intensity and collaboration: Impact on firm growth across technological environments. Strategic Management Journal29(10): 1057–1075.
4.
ArgyresNBigelowLNickersonJA (2015) Dominant designs, innovation shocks, and the follower’s dilemma. Strategic Management Journal36: 216–234.
5.
BatraSSharmaSDixitMR, et al. (2018) Does strategic planning determine innovation in organizations? A study of Indian SME sector. Australian Journal of Management43: 493–513.
6.
BlockJHKohnKMillerD, et al. (2015) Necessity entrepreneurship and competitive strategy. Small Business Economics44: 37–54.
7.
BrennerTSchimkeA (2015) Growth development paths of firms: A study of smaller businesses. Journal of Small Business Management53: 539–557.
8.
CefisECiccarelliM (2005) Profit differentials and innovation. Economics of Innovation and New Technology14(1–2): 43–61.
9.
CefisEOrsenigoL (2001) The persistence of innovative activities: A cross-country and cross-sectors comparative analysis. Research Policy30: 1139–1158.
10.
ChettySBlankenburg HolmD (2000) Internationalisation of small to medium-sized manufacturing firms: A network approach. International Business Review9: 77–93.
11.
CoadA (2009) The Growth of Firms: A Survey of Theories and Empirical Evidence. Cheltenham: Edward Elgar Publishing.
12.
CoadA (2017) Firm age: A survey. Journal of Evolutionary Economics28: 1–31.
13.
CoadARaoR (2008) Innovation and firm growth in high-tech sectors: A quantile regression approach. Research Policy37: 633–648.
14.
CoadADaunfeldtSOHalvarssonD (2018) Bursting into life: Firm growth and growth persistence by age. Small Business Economics50: 55–75.
15.
CoadAFrankishJSRobertsRG, et al. (2016a) Predicting new venture survival and growth: Does the fog lift?Small Business Economics47: 217–241.
16.
CoadASegarraATeruelM (2016b) Innovation and firm growth: Does firm age play a role?Research Policy45: 387–400.
17.
CozzaCMalerbaFMancusiML, et al. (2012) Innovation, profitability and growth in medium and high-tech manufacturing industries: Evidence from Italy. Applied Economics44(15): 1963–1976.
18.
D’AveniRADagninoGBSmithKG (2010) The age of temporary advantage. Strategic Management Journal31(13): 1371–1385.
19.
De MassisAKotlarJCampopianoG, et al. (2015) The impact of family involvement on SMEs’ performance: Theory and evidence. Journal of Small Business Management53: 924–948.
20.
DeephouseDL (1999) To be different, or to be the same? It’s a question (and theory) of strategic balance. Strategic Management Journal20: 147–166.
21.
DeephouseDLSuchmanM (2008) Legitimacy in organizational institutionalism. In: GreenwoodROliverCSuddabyR (eds) The SAGE Handbook of Organizational Institutionalism. Los Angeles, CA: SAGE, pp. 49–77.
22.
DemirelPMazzucatoM (2012) Innovation and firm growth: Is R&D worth it?Industry and Innovation12: 45–62.
23.
DeschryvereM (2014) R&D, firm growth and the role of innovation persistence: Analysis of Finnish SMEs and large firms. Small Business Economics43: 767–785.
24.
FernMJCardinalLBO’NeillHM (2012) The genesis of strategy in new ventures: Escaping the constraints of founder and team knowledge. Strategic Management Journal33: 427–447.
25.
FreelMSRobsonPJ (2004) Small firm innovation, growth and performance evidence from Scotland and Northern England. International Small Business Journal22: 561–575.
26.
GalMS (2009) Competition Policy for Small Market Economies. Cambridge, MA: Harvard University Press.
27.
GeroskiPA (1993) Antitrust policy towards co-operative R&D ventures. Oxford Review of Economic Policy9: 58–71.
28.
GronumSSteenJVerreynneML (2016) Business model design and innovation: Unlocking the performance benefits of innovation. Australian Journal of Management41: 585–605.
29.
GronumSVerreynneMLKastelleT (2012) The role of networks in small and medium-sized enterprise innovation and firm performance. Journal of Small Business Management50: 257–282.
30.
HavemanHA (1993) Follow the leader: Mimetic isomorphism and entry into new markets. Administrative Science Quarterly38: 593–627.
31.
HenreksonMJohanssonD (2010) Gazelles as job creators: A survey and interpretation of the evidence. Small Business Economics35: 227–244.
32.
HoferSMSliwinskiMJ (2006) Design and analysis of longitudinal studies on aging. In: BirrenJESchaieKW (eds) Handbook of the Psychology of Aging. 6th ed.Burlington, MA: Elsevier, pp. 15–37.
33.
IpinnaiyeODineenDLenihanH (2017) Drivers of SME performance: A holistic and multivariate approach. Small Business Economics48: 883–911.
34.
IrelandRDCovinJGKuratkoDF (2009) Conceptualizing corporate entrepreneurship strategy. Entrepreneurship Theory and Practice33: 19–46.
35.
KhanSATangJJoshiK (2014) Disengagement of nascent entrepreneurs from the start-up process. Journal of Small Business Management52: 39–58.
36.
LévesqueMMinnitiMShepherdD (2009) Entrepreneurs’ decisions on timing of entry: Learning from participation and from the experiences of others. Entrepreneurship Theory and Practice33: 547–570.
37.
LindJTMehlumH (2010) With or without U? The appropriate test for a U-shaped relationship. Oxford Bulletin of Economics and Statistics72: 109–118.
NachumLZaheerSGrossS (2008) Does it matter where countries are? Proximity to knowledge, markets and resources, and MNE location choices. Management Science54: 1252–1265.
40.
Ortega-ArgilésRPottersLVivarelliM (2011) R&D and productivity: Testing sectoral peculiarities using micro data. Empirical Economics41: 817–839.
41.
ParuchuriSAwateS (2017) Organizational knowledge networks and local search: The role of intra-organizational inventor networks. Strategic Management Journal38: 657–675.
42.
PenroseET (1959) The Theory of the Growth of the Firm. Oxford: Oxford University Press.
43.
PlummerLAAcsZJ (2012) Localized competition in the knowledge spillover theory of entrepreneurship. Journal of Business Venturing29: 121–136.
44.
RoperSHewitt-DundasN (2008) Innovation persistence: Survey and case-study evidence. Research Policy37: 149–162.
45.
SantosFMEisenhardtKM (2009) Constructing markets and shaping boundaries: Entrepreneurial power in nascent fields. Academy of Management Journal52: 643–671.
46.
SarasvathySD (2001) Causation and effectuation: Toward a theoretical shift from economic inevitability to entrepreneurial contingency. Academy of Management Review26: 243–263.
47.
SemadeniMAndersonBS (2010) The follower’s dilemma: Innovation and imitation in the professional services industry. Academy of Management Journal53: 1175–1193.
48.
SpulberDF (2009) Competition among entrepreneurs. Industrial and Corporate Change19: 25–50.
SwaminathanADelacroixJ (1991) Differentiation within an organizational population: Additional evidence from the wine industry. Academy of Management Journal34: 679–692.
51.
UcbasaranDWestheadPWrightM, et al. (2010) The nature of entrepreneurial experience, business failure and comparative optimism. Journal of Business Venturing25: 541–555.
52.
WiklundJPatzeltHShepherdDA (2009) Building an integrative model of small business growth. Small Business Economics32: 351–374.
53.
WrightMMarlowS (2011) Entrepreneurial activity in the venture creation and development process. International Small Business Journal30: 107–144.
54.
ZapkauFBSchwensCKabstR (2014) Foreign direct investments and domestic employment of German SMEs: The moderating effect of owner management. Journal of Small Business Management52: 451–476.
