Technology-based Firms Research Articles

Urban entrepreneurship and sustainable businesses in smart cities: Exploring the role of digital technologies

The entrance of sustainable and digital technologies into urban entrepreneurship is a new approach that provides a fertile ground for innovation in businesses. Hence, businesses use new models and methods of entrepreneurship in the context of smart cities to increase their capability and become more sustainable, which leads to their development and expansion. This research aims to investigate the effects of urban entrepreneurship on sustainable businesses in smart cities considering the role of digital technologies. The statistical population of this study is all active technology-based firms located in Tehran in 2022. Then, according to Cochran's formula, 315 firms were selected randomly as the sample. This research is an applied and descriptive-survey research and is quantitative in terms of the type of collected data. The data were analysed using Smart PLS 3 software, structural equation modelling (SEM), and the partial least squares methods. As a result, research findings show that urban entrepreneurship creates and develops the studied firms in both quantitative and qualitative aspects by using and benefiting from digital technologies considering the new needs of cities and achieving business sustainability in smart cities.

Technology Opportunity Discovery using Deep Learning-based Text Mining and a Knowledge Graph

To capture emerging technologies in the fast-changing technology market, use of information concerning new technology-based firms (NTBFs) is strongly encouraged, in addition to the information about the technology itself. Especially, NTBFs rapidly respond to technological change, and their investment information is a significant criterion of technology valuation. Therefore, this study proposes a new technology opportunity discovery (TOD) framework that exploits text mining by deep learning and a knowledge graph (KG) by using three data sources: technology, NTBF, and investor data. First, a technology-classification model was developed using technical text data acquired using Doc2vec and logistic regression, and then this model assigned highly-relevant technology fields to NTBFs using NTBFs’ investor relation text data. Next, a KG that considers technology, NTBF, and NTBF’s investor was constructed to represent their relations for TOD by using the results of previous steps. Lastly, considering inter-connectivities of such factors, a TOD index that measures the potential of technologies was proposed. The accuracy and validity of the methods were demonstrated empirically, and an evaluation of emerging technologies identified by the analysis was provided. Our framework will be of great significance as a useful alternative to provide new insights for emerging technologies in the industry and market.

Intellectual capital and the acquisition of human capital by technology-based new ventures

PurposeIntellectual Capital (IC) is essential to the success of new technology-based firms. A key component of IC is human capital. Human capital is shown to affect firm innovation, growth, and survival positively. This paper investigates the signaling effect of technology-based start-ups’ initial stock of IC on obtaining skilled human capital.Design/methodology/approachThe researcher employs signaling theory to analyze primary data concerning the firm’s initial stock of IC and subsequently hired human capital from founders of 236 technology-based new ventures in the USA Hypotheses are tested through a set of hierarchical linear regressions.FindingsThis study demonstrates that the firms’ IC, in the form of quantity of founders with doctorates and intellectual property, correlates with the quality (average education level) of subsequently hired technical and business human capital. In addition, the quantity of founders with doctorates is correlated with the quantity of subsequently hired technical human capital.Originality/valueThe paper collects retrospective data from founders of technology-based new ventures. While human capital is important for technology-based firms’ innovation and growth, little research has investigated potential connections between firms’ initial IC and subsequent hiring of top-level human capital. This paper investigates these connections explicitly.

Spillovers of innovation subsidies on regional industry growth: Evidence from China

Spillover is an important channel through which government innovation policies boost economic growth. Despite various firm-level analyses on the effectiveness of innovation subsidies, industry-level spillovers of such subsidies and determinants of their strength are not well-studied. Based on the sample of all the subsidized manufacturing and service industries in the Innovation Fund for Small and Medium Technology-based Firms (Innofund) program from 1999 to 2014, we examine the spillover effects of innovation subsidies and explore rich heterogeneities across regions and industries. We find significantly positive spillover effects of the innovation subsidies on the subsidized industries and their upstream and downstream industries regarding the firm number, employment and output growth. Furthermore, we find large vertical spillovers of subsidies from high-tech service sectors to manufacturing sectors for the first time. The spillovers work through market linkages, strengthened by marketization, decentralized governance, and interactions between different techno-industrial policies.

Young entrepreneurs and skills mismatch in school-to-work transition: empirical evidence from innovation processes managed in Italian NTBFs

PurposeDiversity in entrepreneurship has become a noteworthy topic of research since consistent differences – and few similarities, if any – exist among entrepreneurial profiles. The present paper aims to compare different entrepreneurial profiles managing innovation processes in new technology-based firms (NTBFs). In particular, attention is focussed on young entrepreneurs who are in a critical phase of their lifelong learning, the school-to-work transition.Design/methodology/approachStatistical elaborations are based on data retrieved from Italian Ministry of Economic Development in January 2021 and carried out through stochastic frontier analyses. Respectively, 1,699 young entrepreneurs, 1,079 female entrepreneurs, 205 ethnic entrepreneurs and 8,224 stereotyped entrepreneurs are considered.FindingsFactors affecting the performance of innovation processes managed in NTBFs are the same for stereotyped and female entrepreneurs, but they consistently differ for young and ethnic entrepreneurs. Achieved results are not in the position to offer a complete analysis of the phenomenon but – hopefully – can corroborate a very interesting and up-to-date research path that merits further development. In particular, young entrepreneurs disclose an unexpected skills mismatch that should be investigated in-depth.Originality/valueMost contributions offer a narrow view of entrepreneurial profiles since they focus on one profile per time. The present paper, instead, considers four entrepreneurial profiles and compares them. Moreover, young entrepreneurs reveal an unexpected skills mismatch that underlines the relevance of specific activities of on-the-job training and apprenticeships in order to try to overcome it and improve the results achievable by young entrepreneurs.

Examining the mediating role of dynamic capabilities in the relationship between information and communication technologies and sustainable performance

PurposeInformation and communication technologies (ICTs) enable firms to improve their processes to remain competitive and profitable in today’s market. These demands not only value economic results but also social impact and environmental care. In other words, firms must achieve sustainable performance. However, to take on these new sustainability challenges, firms must have dynamic capabilities to take advantage of highly changing technology. Thus, this study aims to examine the mediating role of dynamic capabilities in the relationship between ICT and sustainable performance.Design/methodology/approachThis study was empirical, associative and explanatory, following a latent variable design. The sample of the study consisted of partners, founders, executives and promoters from 102 Colombian new technology-based firms selected through purposive non-probabilistic sampling. Variance-based structural equation modeling or partial least squares was used for the statistical data analysis.FindingsA higher-order model was tested, corroborating that ICT was composed of two dimensions (use and acquisition), dynamic capabilities were composed of three dimensions (absorption, innovation and adaptation), while sustainable performance showed a unidimensional structure. As for the research hypotheses, all the direct effects were supported, as well as the mediating effect of dynamic capability in the relationship between ICT and sustainable performance, this being a complementary mediation.Originality/valueThis study highlights the importance of dynamic capabilities for firms today, especially those working with high levels of technology. Also, considering the results obtained, firms must implement better strategies in the acquisition and use of technology to improve their sustainable performance in dynamic and uncertain environments.

Influences of university-industry alliance portfolio depth and breadth on growth of new technology-based firms: Evidence from China

In emerging economies, new technology-based firms (NTBFs) often engage in multiple alliances with universities and research institutes simultaneously to access external knowledge and resources crucial for their survival and growth, thus forming university-industry alliance portfolios (UIAPs). However, little scholarly attention has been paid to this phenomenon. Using panel data of 549 firm-year observations from 149 manufacturing NTBFs listed on Chinese Growth Enterprises Market (GEM) Board, we develop a set of multi-level fixed-effect liner regression models to investigate effects of UIAP relational-dimension configurations on NTBF growth along with the moderating effects of government subsidies. Results reveal negative effects of UIAP depth on firm growth and positive impacts of UIAP breadth on firm growth. Furthermore, results show that government subsidies weaken the negative relationship between UIAP depth and NTBF growth, along with the positive relationship between UIAP breadth and NTBF growth. Contributing to previous research on alliance portfolios, university-industry collaborations, and firm growth, this study provides some practical implications for both industry practitioners and policymakers in emerging economies.

The centrality of organisational factors in the growth of new technology-based firms

PurposeNew technology-based firms (NTBFs) are a great potential source of job creation and economic growth. In France, strong heterogeneity of their growth trajectories is observed yet many of them remain small. A better understanding of these trajectories is thus necessary. The purpose of this paper is to explore the influence of individual and organisational factors on 253 growth trajectories of NTBFs.Design/methodology/approachThe authors use a Heckman ordered probit model to study explanatory factors of growth trajectories in NTBFs created between 1999 and 2012. This method allows them to study the determinants of the presence of a growth dynamics at the same time as the determinants of growth intensity.FindingsThe model shows that entrepreneurs play a weak role in understanding the growth trajectories of their company. Rather, it is organisational factors – such as the level of innovation and the governance structure – that explain initiation of a growth trajectory and the intensity of the growth.Originality/valueBy using an original methodology, the authors highlight the importance of organisational factors and encourage entrepreneurs to develop a governance structure focused on internal stakeholders to support growth.

Skills required for 4IR professionals in technology-based firms

Skills required for 4IR professionals in technology-based firms

The Connections Between Founders’ Social Network and Human Capital in Technology-Based New Ventures

Abstract This research examines the relationship between a founding team’s social network and the acquisition of its critical human capital. First, explicitly dealing with technology-based firms, we disaggregate the founder(s) social network into four sub-networks: academic, industry, finance, and personal (family and community). Then, we detail the relationship between these individual sub-networks and the acquisition of both technical and business skilled human capital. Our results confirm that individual sub-networks have a differential effect on acquiring both technical and business human capital.

The influence of performance feedback and top management team orientation on decisions about R&D in technology-based firms

The purpose of this work is to investigate the influence of performance feedback on decisions about R&D—more specifically R&D intensity and R&D direction, ranging from exploitation to exploration—and how this varies depending on top management team orientation. Using panel data collected from a large sample of technology-based firms over nine years, hypotheses about how the relationship between performance feedback and decisions about R&D are moderated by the technology orientation of top management teams are tested. Overall, the findings support the basic premises put forth, namely that top management team orientation influences decisions about R&D in response to performance feedback. This sheds new light on our understanding of the relationship between performance feedback and decisions about R&D in technology-based firms.

Critical Factors in the Formation and Development of Technology-Based Firm Networks in Incubation Environments in Brazil

This research aims to identify the critical factors that influence the formation and development of the interorganizational networks that have emerged within incubators of technology-based firms in Brazil. For this purpose, semi-structured interviews were conducted with startups form two networks of incubated companies (Education Network and Technology, Information and Knowledge Companies Network) and two incubators (Center of Innovation, Entrepreneurship and Technology — CIETEC — and Incubator of Technology-Based Companies of Itajubá — INCIT). As a result, this study found eight critical factors: Actions by entrepreneurs, leadership, shared spaces, facilitation, network management, financial and brokerage, which can be framed in four characteristics: heterogeneity of the firms, lack of cooperation, interactions and the actions of the incubator. As a contribution, this research allows reflection on the effectiveness of the incubator, in addition to highlighting the complementarity of networks in the incubation processes. The study analyses different models of incubated firm networks that have been little explored as an object of study in the incubation literature and networks and what is the role of the incubator in each of these models.

The Value of PhDs: How the Presence of PhDs in Founding Teams Increases the Attractiveness of Startups for Corporate Investors

The creation and development of new technology-based firms (NTBFs) is at the core of national prosperity, and constitutes a key activity of the innovation policies of advanced and developing economies. Many of these companies are founded by postgraduates that hold a doctorate (PhDs). Governments foster the creation of NTBFs by PhDs to take advantage of the stock of knowledge which exists in universities and research centers. It is assumed that founders with a high level of specialization and knowledge, such as PhDs, will bring strong competitive advantages to the companies they found. The literature in this regard, however, is scarce and inconclusive. We have studied the role of PhDs in founding teams of NTBFs in a specific kind of entrepreneurial process: corporate venturing. Our conclusions suggest that companies with PhDs are significantly more attractive to corporate venture capital. Corporate venturing has a higher propensity to invest in NTBFs with PhDs in the founding teams, and these companies concentrate a higher number of corporate investors, in a kind of accumulative effect.

Anticipating promising services under technology capability for new product-service system strategies: An integrated use of patents and trademarks

Product-service systems (PSSs) have been the subject of numerous prior studies, most of which focus on presenting PSS strategies from a customer-centric perspective. This study offers a different approach to proposing new PSS strategies based on promising services that companies can implement using existing technology capability. First, business ecology networks consisting of goods and services are constructed using the trademarks of technology-based firms. Second, link prediction methods were applied to anticipate promising services. Third, patents were analyzed to determine whether the services can be developed using existing technology capabilities. Finally, a PSS portfolio map for establishing new PSS strategies for the target product is presented. Promising services and new PSS strategies are suggested according to whether they can be implemented using existing technology capability. A case study on wearable audio devices demonstrated the applicability and feasibility of the proposed approach. Indeed, promising services, such as self-reservation services and health and medical services, are suggested. A systematic approach and its quantitative outcomes are expected to have significant implications in practice as a support tool for decision-making regarding PSS strategy development. In addition, the proposed approach contributes to the existing literature by suggesting the broader use of intellectual properties.

The organization of innovation services in science and technology parks: Evidence from a multi-case study analysis in Europe

Science and Technology Parks (STPs) are key elements of the infrastructure supporting the growth of today's global knowledge economy. STPs create environments that foster collaboration, innovation, and entrepreneurship, and provide innovation services to support new technology-based firms in their activities. However, despite the extensive research on STPs, limited evidence has been provided regarding their organization of a portfolio of innovation services. In this work, we deepen the organizational challenges in developing a portfolio of innovation services through the analysis of the literature and ethnographic research on six case studies of European STPs in Italy, Spain, and Switzerland. In conclusion, based on the literature and the case studies, we highlight i) the four main alternatives to include an innovation service in an STP's portfolio; ii) the fundamental six drivers influencing the choice between these different alternatives.

Innovation and SDGs through Social Media Analysis: Messages from FinTech Firms

Financial technology-based firms (FinTech) are crucial to promoting new technologies and advances in innovations related to the financial field, sustainable development, and financial inclusion. This paper aims to assess the Sustainable Development Goals (SDGs) and open innovation integrated within the public discourse in the social media of FinTech firms, using machine-learning-based social media analysis (SMA). Accordingly, we tracked the behavior of 21 firms based on the empirical material of 32,716 posts on Twitter. The outcomes showed dissimilar discourses based on FinTech firms’ activities. However, it was found that only financial infrastructure, lending, and personal finance fields have a discourse related to innovation and, to a lesser extent, related to the SDGs thematic. Thus, awareness of sustainable objectives is still far from being a relevant issue for FinTech, which, in general, has neglected to significantly mention SDGs; nonetheless, innovation and related terms are a consistent topic in this area. Furthermore, hints of the implementation of the open innovation paradigm and interest in novel technologies are demonstrated, in addition to the promotion of different actors and events on social media that serve as a showcase for firms that have a presence on Twitter.

Impacts of Firm Performance on Corporate Social Responsibility Practices: The Mediation Role of Corporate Governance in Ethiopia Corporate Business

In today’s globalized economy, the corporate company faces ever-increasing competitive and social pressures. This paper aims to identify the impacts of firms’ performance on corporate social responsibility practices using the mediating roles of corporate governance evidence from Ethiopia’s corporate business. The impacts of firms’ performance on CSR and corporate governance as a mediator variable were studied using a sample of TIRET corporate companies, in the Amhara region, Ethiopia. The structural equation model and multiple regression analysis were estimated and tested using 21 corporate companies. The derived model reveals how corporate governance mediates the favorable relationship between CSR and firm performance. The result indicates that a firm’s performance is the most significant influencing factor on CSR among the impacts examined in this study. Corporate governance has a positive role in serving as a legitimacy source for CSR practice. This study discusses the significance of results-based resource theory and presents the conclusion and implications. To solve the gaps in firm performance, return on asset, debts on capital structure, and governance, the corporate firms should identify unproductive enterprises and outsource non-core values. To overcome the existed inefficiency difficulties, this study proposed that corporate enterprises should be restructured, rebranded, reconsider their business models, and acquire technology-based firms. This paper contributes to CSR literature in the context of emerging economies. Firms, policymakers, and practitioners may take steps to improve CSR practice. In general, we conclude that in Ethiopia, including in the Amhara region, socially responsible corporate enterprises are more likely to be successful, and vice versa.

Entrepreneurial teams and early performance of new ventures: An analysis of Taiwanese tech-firms

In this paper, we investigate the effects of the relation between the human capital of the entrepreneurial team, R&D-manufacturing linkage and the performance of new technology-based firms in accordance with a resource-based view. We try to comprehend how entrepreneurial teams and R&D-manufacturing linkage shape firm’s ability to have a positive outcomes in terms of company sales revenue and international connection. We take advantage of a new data relating to a sample composed of 152 taiwanese young firms that operate in technology-based industries. We find that firms with higher proportionally advanced professional education entrepreneurs in the team have a positive effect on firms' performance. Furthermore, it is R&D-manufacturing linkage that determines technology-based firm’s growth. Individuals with entrepreneurial experiences exerts key influences on firm's international connection. Firms can also benefit from their team members' background affiliation and achieve better performance. Lastly, we provide evidence that there are gains from the complementary capabilities of entrepreneurial teams and firms relating to (i) advanced professional education , (ii)entrepreneurial or CEO experiences and team members' background affiliation and (iii) R&D-manufacturing linkage. We conclude that the human capital of entrepreneurial team and R&D-manufacturing linkage of new technology-based firms have a critical impact on the firm’s development. These findings are consistent with and complements the growing body of research that emphasizes the importance of entrepreneurial teams in developing knowledge about the strategies and allocation of the enterprises resources.

Small firm Growth-Enabling Capability: Toward a Framework for Young Technology-Based Firms (WITHDRAWN)

Growth of young technology-based firms (YTBFs) is dynamic rather than linear in nature. As such, the increased complexity accompanying their growth confronts YTBFs with unique challenges, making it difficult for these firms to grow. Despite this inherent complexity, however, there remains much left to discover in terms of how such transitioning processes can be facilitated. While earlier studies have mostly adopted a stage-based approach to exploring the notion of growth, we argue that viewing the concept through a dynamic perspective presents a more appropriate approach in the context of YTBFs. In this article we indeed assume a dynamic perspective to explore how YTBFs can facilitate dynamic growth transitions. Based on insights from strategic entrepreneurship and growth literature, we suggest that such transitioning is reflected by three inherent challenges: the engineering challenge, the orchestration challenge, and the legitimation challenge. To achieve our objective, we adopt a qualitative, systematic combining approach based on eight exploratory interviews, eight semi-structured interviews, and two focus groups. We find that YTBFs should focus on the development of absorptive, adaptive, networking, innovative, learning, and individual (managerial) capabilities, in order to enable growth-transitions. Our results are largely in line with, but also extending, existing literature in that they show how particular capabilities can be perceived as relevant growth-enabling capabilities. As such, this study contributes to several research streams, providing interesting paths to future investigation. First, by adopting a strategic entrepreneurship perspective, we adopt a novel approach to addressing the problem of growth-transitioning in the context of YTBFs. Similarly, this allows us to explore the relevance and application of dynamic capabilities in the same context, which has received a rather limited attention as opposed to that of established firms. To further clarify our article’s contributions, we develop a comprehensive framework, connecting our results to existing literature, explaining how each capability can be related to particular challenges, thereby paving the way for further research on the topic. In doing so, we provide managerial insights for YTBFs’ managers to enhance their understanding of growth and more appropriately allocate their resource-investments. Our study’s main limitation is represented by the relatively small sample used and its exploratory approach, which provides incentive for further empirical investigation to validate our results.

When Does Entrepreneurial Failure Help the Next Tech-Based Start-Up?

How entrepreneurs respond to previous start-up failure has important implications for subsequent start-up performance. As part of the research about entrepreneurial failure experience, prior researchers have examined the antecedents of learning from entrepreneurial failure. We extend the literature by focusing on changes in business model and technology after a previous start-up failure, which are crucial antecedents to understand learning mechanisms from entrepreneurial failure. To understand whether a failed entrepreneur who changed a business model or technology shows a performance advantage in a subsequent start-up or not, we build our hypotheses based on a behavior theory of firms. Using data on early-stage technology-based firms, we find several notable results. First, start-ups that change their internal business aspects (business model or technology) after previous start-up failures perform better than other start-ups that do not change their business model after previous start-up failure. Second, start-ups that change internal business aspects (business model or technology) after previous start-up failure show higher performance than other start-ups that change internal business aspects (business model or technology) after previous start-up success. Thus, the results have important implications for the study of learning antecedents from entrepreneurial failure experience.