Leadership style of the CEO is pivotal for the performance of any firm (Waldman et al., 2001; Podsakoff et al., 1996). Despite this effect found in studies throughout established companies (Tarabishy et al., 2005), both entrepreneurship as well as leadership scholars paid limited attention to entrepreneur leadership and its outcomes within new ventures (Ensley et al., 2006; Daily et al., 2002; Jensen & Luthans, 2006). Little research has emerged since the first call for expanding the study of leadership towards new ventures (Miller & Friesen, 1984). Until today, no study responds to the calls by Antonakis & Autio (2006), following Vecchio (2003) and Yukl (1999), for a context-focused investigation of the leadership-performance link within new ventures.

With contemporary thinking about leadership focusing on a) transformational and b) transactional leadership, already Bass (1985) highlighted contextual factors as potential moderators of leadership effectiveness (Pawar & Eastman, 1997). Focusing on new ventures only, this paper integrates individual-level leadership behavior with contextual-level factors in explaining performance differences. Drawing on contingency theory (Burns & Stalker, 1961; Fiedler, 1971), we expand the limited knowledge about leadership in new ventures by paying particular attention to the moderating role of entrepreneurial context.