The film industry offers a unique context in which to study entrepreneurial behavior. For each new project, production companies select, acquire, and combine various resources to develop a film that audiences will appreciate. Because audience tastes are constantly changing, resource combinations that worked in the past are not necessarily guaranteed to work in the future. Each new film project is therefore fraught with substantial ambiguity and uncertainty. In a now famous quote about the motion picture industry, William Goldman stated, “nobody knows anything” (quoted in Shamsie, 2006: 177). The role of a production company in shepherding a film to completion is thus akin to that of an entrepreneur operating in an uncertain and equivocal environment (Hill & Levenhagen, 1995; Levenhagen, Porac, & Thomas, 1993).

In this paper, we examine the degree to which experience within a particular range of financial resources influences subsequent success. We suggest that each production company develops the knowledge and skills that result from working on films that fall within a particular budget range. When these firms undertake projects that fall within this range, they are likely to stay successful. We argue that these companies may not do as well when they undertake projects that have different budgets than what they have been accustomed to working with.