Abstract

Advisors are important for nascent ventures, as they offer advice, knowledge and potentially useful business contacts and can significantly contribute to a venture’s sales growth and innovation. Given the limited time and attention of entrepreneurs, we question the generally held assumption that more advice is better, by investigating the impact of the type of advice. We hypothesize that business and technology advice will both have a positive impact on a venture’s business model development and technology progress. We further propose competing hypotheses regarding the positive effect of advisors; namely, whether advice is more useful for inexperienced founders in greater need of advice or for experienced founders that are better able to implement suggestions. Finally, we examine whether the effect of the nature of the advice on a venture’s business and technology development depends on the nature of the entrepreneur’s prior experience.

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