How Technology–Based New Firms Leverage Newness and Smallness to Commercialize Disruptive Technologies

Abstract

Although the survival of young firms is challenged by the liabilities of newness, there are numerous instances where these firms have been successful at commercializing disruptive technologies at the expense of much larger and stronger incumbents. This paper explores this phenomenon and argues that the characteristics that challenge young technology–venture survival are also potential sources of advantage when commercializing disruptive technologies. The propositions developed also identify the boundary conditions for the advantages by examining the context of commercialization that is created by four types of disruptive technologies. The contributions of this paper are relevant to the enhanced understanding of the liabilities of newness, as well as the commercialization of disruptive technologies.