A Knowledge-Based View of the Venture Creation Process: How Technology Entrepreneurs Mix Knowledge to Create Radical Innovations

Abstract

The knowledge of technology entrepreneurs within the venture creation process is explored. A knowledge framework developed in 2000 by Scott Shane is used to assess technology entrepreneurs' knowledge prior to opportunity recognition and to measure knowledge acquired prior to the venture launch. The variables in the knowledge framework include ways to serve markets, customer problems, technology, and markets.Data from a survey of 145 founders of young technology ventures throughout the Midwest are used to identify the mix of variables from Shane's framework that is present at opportunity recognition, as well as the mix of knowledge present between recognition and the venture launch.Results indicate that technology knowledge outranks the other variables at opportunity recognition, while knowledge of customer problems is important prior to venture launch. These results do not appear to differ by industry. Finally, prior technology knowledge at opportunity recognition is the strongest predictor of radical innovation outcomes.