Abstract

New ventures can be started by independent entrepreneurs (IVs) or by corporate parents (CVs). Research has shown that origin influences a new venture’s access to resources, its autonomy, its decision making process and its performance (Hitt et al., 1999; Zahra, 1996). Research has also shown that the value of resources varies depending on the conditions a firm faces in its environment (Miller & Shamsie, 1996). Since resource availability differs based on venture origin, and resource value depends on environmental conditions, then a question arises whether venture origin would be expected to influence performance in different environments. This question is the primary focus of this study.

Utilizing the knowledge-based perspective, numerous hypotheses are developed and tested investigating the performance of IVs and CVs under different environmental conditions. Specifically, we examine conditions of innovative intensity, uncertainty, and ambiguity; contexts that have implications for the usefulness of knowledge resources and for the comparative advantage of IVs and CVs. While a main focus of this paper is to compare IV and CV performance in different environmental conditions, we also examine how the degree of relatedness between parent and CV impacts CV performance. Research has shown that resource relatedness between parents and CVs has the potential to be either positive or negative depending on the context in which the resources are deployed (Thornhill and Amit, 2001).

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