First-mover advantages and intentional knowledge spillover effects on cybersecurity start-ups’ financial and innovation performance: incentive for revealing innovations in high-tech emerging industry

Abstract

ABSTRACT Cybersecurity industry, an emerging industry, has the distinctive characteristic of low appropriation ecosystem, as exemplified by free disclosure of white papers and open-source software. Focusing on the above characteristics, this study empirically analyses the cybersecurity start-ups’ financial and innovation performance in terms of first-mover advantages. Moreover, this study examines whether the start-ups’ intentional knowledge spillover activities moderate the subsequent performance. A sample of 327 start-ups related to cybersecurity technology was analysed, and the major results are as follows. While first-mover advantages are positively valid in financial performance, the start-ups’ early entry and innovation performance have an inverted U-shaped relationship. Moreover, the start-ups’ intentional knowledge spillover activities positively moderate the interaction between early entry and innovation performance. The results confirm that latecomers are also capable of high innovation performance in the cybersecurity industry, and it suggests that start-ups in the high-tech emerging industry need to convert the innovation paradigm from closed to open, aiming for shared growth of the overall industry scale and sustainable innovation.