New ventures rely very much on close and informal relationships between their members (Tybjee et al., 1983). Furthermore, new ventures are typically less formalized and more flexible than older companies, which are often characterized by more rigid organizational structures (Gruber, 2003). They profit from efficient communication channels leading to fast reactions and decision making, which enables them to respond quicker to environmental changes than older, more established companies (Stinchcombe, 1965). Therefore we hypothesize that their absorptive capacity (ACAP), namely the ability, “to recognize the value of new external information, assimilate it, and apply it to commercial ends” (Cohen & Levinthal, 1990, p.128), should impact their performance more than it would in established companies.

Our research model addresses two issues. First, we reassess the question of how ACAP impacts performance. Second, we shed light on the question whether ACAP is more beneficial for new ventures than for established companies. To answer these questions, we mainly draw on insights from the dynamic capabilities approach (Teece et al., 1997; Wade & Hulland, 2004).