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| Author: | Andries, P. Debackere, K. |
| Title: | Adaptation and performance in new businesses: Understanding the moderating effects of independence and industry |
| Journal: | Small business economics
2007 : JUN/AUG, VOL. 29:1-2, p. 81-99 |
| Index terms: | industries new enterprise success uncertainty |
| Language: | eng |
| Abstract: | When trying to find a viable business model, new ventures and new business units face notable difficulties. Adapting the initial business model is a common occurrence, and especially technology-based firms experience high degrees of uncertainty and ambiguity. This paper starts from a hypothesis that adaptation is critical for the performance of new businesses, and, at the same time, this effect is weakened by the (in)dependence of the new technology-based business and by the industry in which it is active. Testing the hypothesis with a survival analysis of a sample of 117 new ventures and business units, the authors find out that the adaptation seems to be beneficial in less mature, capital-intensive and high-velocity industries, and that the adaptation diminishes failure rates particularly in dependent business units. |
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