Does venturing increase firm value? The relevant literature on the relationship between external corporate venturing--a corporate entrepreneurship strategy encompassing venture capital investments, equity joint ventures, and acquisitions--and firm value is decidedly mixed. In this study, we suggest a configurational approach to understanding the venturing-firm value relationship, positing that venturing per se is not likely to meaningfully increase firm value, but value will increase for firms employing venturing in particular environmental contexts and when adopting specific organizational structures.

We predicate our argument on an attentional perspective that operational concentration facilitates a strategic focus on venturing opportunities that add material value to the firm’s core business. The diminishing extant opportunities in hostile environments similarly focus managerial attention on high value venturing opportunities. Collectively, operational concentration and a hostile operating environment provide strategic discipline to venturing activities, which investors in turn reward with higher firm valuations.