Abstract

The competence-based perspective of the firm regards competencies as informational capital (knowledge) which is tacit and asymmetrically distributed across firms and individuals (Foss, 1993; Pelikan, 1989). In entrepreneurship context, industry experience, start-up experience, and education of founders can be deemed as representative, objective measures of founders’ competencies. Past studies reveal, generally, a positive relationship between founders’ industry experience and start up experience and new venture growth (Reynolds, 1993; Bruderl and Preisendorfer, 1998; Colombo & Grilli, 2005). The evidence regarding the impact of education is inconclusive (cf. Parker, 2009). Drawing on the knowledge based perspective of the firm (Rues et al, 2009; Nonaka & von Krogh, 2009; Grant, 1996), we argue that general knowledge (industry experience, education) and specific knowledge (start up experience) have differential impact on the initial revenue and change in revenue growth over time. Drawing on commitment literature (Suliman & Iles, 2000; Klein, & Kim 1998), we contend that simply having competent founders is not enough for a new venture growth. An adequate level of concomitant commitment among the founders is necessary.

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