Strategy and performance of new ventures: A contingency model of the role and influence of the venture capitalist

Venture Capital

Volumn 5, Issue 3, 2003, Pages 231-250

  Wijbenga, Frits H ^a   Postma, Theo J B M ^a   Van Witteloostuijn, Arjen ^a,b   Zwart, Peter S ^a  

^a UNIVERSITY OF GRONINGEN   (Netherlands)

^b DURHAM UNIVERSITY   (United Kingdom)

Author keywords

Board roles; New ventures; Strategic fit; Strategy; Value adding activities

Indexed keywords

EID: 0345491588     PISSN: 13691066     EISSN: None     Source Type: Journal    
DOI: 10.1080/1369106032000118171     Document Type: Review

References (98)

1. Amit, R., Brander, J. and Zott, C., 1998, Why do venture capital firms exist? Theory and Canadian evidence. Journal of Business Venturing, 13, 441-466.
2. Barney, J. B., 1991, Firm resources and sustained competitive advantage. Journal of Management, 17, 99-120.
3. Barney, J. B., Busenitz, L. W., Fiet, J. O. and Moesel, D. D., 1996, New venture teams' assessment of learning assistance from venture capital firms. Journal of Business Venturing, 11, 257-272.
4. Barnhart, S. W., Marr, M. W., Rosenstein, S., 1994, Firm performance and board composition: some new evidence. Managerial and Decision Economics, 15, 329-340.
5. Baysinger, B. D. and Hoskisson, R. E., 1990, The composition of boards of directors and strategic control: effects on corporate strategy. Academy of Management Journal, 34, 205-214.
6. Becker, G. S., 1964, Human Capital (New York: Columbia).
7. Beekun, R. I., Stedham, Y. and Young, G. J, 1998, Board characteristics, managerial controls and corporate strategy: a study of US hospitals. Journal of Management, 1, 3-19.
8. Begley, T. M. and Boyd, D. P., 1987, Psychological characteristics associated with performance in entrepreneurial firms and smaller businesses. Journal of Business Venturing, 2, 79-93.
9. Berle, A. and Means, G., 1932, The Modern Corporation and Private Property (New York: Harcourt, Brace & World).
10. Berry, W. D., 1984, Nonrecursive Causal Models, Series: Quantitative Applications in the Social Sciences (Beverly Hills: Sage Publications).
11. Bonoma, T. V. and Johnston, W. J., 1979, Locus of control, trust and decision making. Decision Sciences, 10, 39-55.
12. Boone, C., DeBrabander, B. and Witteloostuijn, A. van, 1996, CEO locus of control and small firm performance: an integrative framework and empirical test. Journal of Management Studies, 33, 667-699.
13. Boone, C. and Witteloostuijn, A. van, 1996, Industry competition and firm human capital. Small Business Economics, 8, 347-364.
14. Boone, C., De Brabander, B. and Witteloostuijn, A. van, 1999a, Locus of control and strategic behaviour in a prisoner's dilemma game. Personality and Individual Differences, 27, 695-706.
15. Boone, C., De Brabander, B., and Witteloostuijn, A. van, 1999b, The impact of personality on behavior in five prisoner's dilemma games. Journal of Economic Psychology, 20, 343-377.
16. Boone, C., De Brabander, B., Carree, M., Jong, De, G., Olffen, W. van and Witteloostuijn, A. van (2002), 'Locus of control and learning to cooperate in a prisoner's dilemma game'. Personality and Individual Differences, 32, 929-946.
17. Brownell, P., 1981, Participation in budgeting, locus of control and organizational effectiveness. The Accounting Review: Quarterly Journal of the American Accounting Association, 56, 4, 844-860.
18. Brownell, P., 1982, The effects of personality-situation congruence in a managerial context: locus of control and budgetary participation. Journal of Personality and Social Psychology, 42, 4, 753-763.
19. Brüderl, J. and Preisendörfer, P., 2000, Fast-growing businesses. International Journal of Sociology, 30, 45-70.
20. Bruining, H. and Wright, M., 2002, Entrepreneurial orientation in management buy-outs and the contribution of venture capital. Venture Capital, 4 (2), 147-168.
21. Brush, C. G. and VanderWerf, P. A., 1992, A comparison of methods and sources for obtaining estimates of new venture performance. Journal of Business Venturing, 7, 157-170.
22. Burt, R. S., 1992, Structural Holes: The Social Structure of Competition (Harvard University Press: Cambridge, MA).
23. Bygrave, W. D. and Timmons, J. A., 1992, Venture Capital at the Crossroads (Boston: Harvard Business School Press).
24. Carter, R. B. and Auken, van, H. E., 1994, Venture capital firms' preferences for projects in particular stages of development. Journal of Small Business Management, January, 60-72.
25. Chirinko, B., Ees, H. van, Garretsen, H, and Sterken, E., 2000, Investor protections, concentrated ownership, and other corporate control mechanisms in the Netherlands, working paper, RuG, Groningen.
26. Cooper, A. C. and Gascón, E. J. G., 1992, Entrepreneurs, processes of founding, and new-firm performance, in D. L. Sexton and J. D. Kasarda (eds) The State of the Art of Entrepreneurship (Boston, M.A.: PWS Kent).
27. Daft, R., 2001, Organisation Theory and Design (New York: West).
28. Deakins, D., O'Neill, E. and Mileham, P., 2000, The role and influence of external directors in small, entrepreneurial companies: some evidence on VC and non-VC appointed directors. Venture Capital, 2, 111-127.
29. Dess, G. G., Lumpkin, G. T. and Covin, J. G., 1997, Entrepreneurial strategy making and firm performance: tests of contingency and configurational models. Strategic Management Journal, 18 (9), 677-695.
30. Dess, G. G., Lumpkin, G. T. and MCGee, J. E., 1999, Linking corporate entrepreneur-ship to strategy, structure, and process: suggested research directions. Entrepreneurship Theory and Practice, 23 (3), 85-102.
31. Dollinger, M. J., 1984, 'Environmental boundary spanning and information processing effects on organizational performance'. Academy of Management Journal, 27, 351-368.
32. Ehrlich, S. B., De Noble, A. F., Moore, T. and Weaver, R. R., 1994, After the cash arrives: a comparative study of venture capital and private investor involvement in entrepreneurial firms. Journal of Business Venturing, 9, 67-82.
33. Elango, B., Fried, V. H., Hisrich, R. D. and Polonchek, A., 1995, How venture capital firms differ. Journal of Business Venturing, 10, 157-179.
34. Fama, E. F. and Jensen, M. C., 1983, Separation of ownership and control. Journal of Law and Economics, 26, 301-325.
35. Feldman, J. M. and Lynch, J. G., 1988, Self-generated validity and other effects of measurement on belief, attitude, intention, and behavior. Journal of Applied Psychology, 73, 421 -435.
36. Flynn, D. and Forman, A. M., 1991, The critical relationship between venture capitalists and entrepreneurs: planning, decision-making, and control. Journal of Small Business Economics, 3, 185-196.
37. Flynn, D. and Forman, A. M., 2001, Life cycles of new ventures organizations: different factors affecting performance. Journal of Developmental Entrepreneurship, 6, 41-58.
38. Forbes, D. P. and Milliken, F. J., 1999, Cognition and corporate governance: understanding boards of directors as strategic decision making groups. Academy of Management Review, 24, 489-505.
39. Fried, V. H., Bruton, G. D., and Hisrich, R. D., 1998, Strategy and the Board of Directors in venture capital-backed firms. Journal of Business Venturing, 13, 493-503.
40. Gabrielson, J. and Huse, M., 2002, The venture capitalist and the board of directors in SMEs: roles and processes. Venture Capital: An International Journal of Entrepreneurial Finance, 4 (2), 125-146.
41. Ginsberg, A. (1994), Minding the competition: from mapping to mastery'. Strategic Management Journal, 15, 153-175.
42. Grossman, S. and Hart, O. 1986, The costs and benefits of ownership: a theory of vertical and lateral integration, Journal of Political Economy, 94, 691-719.
43. Goodstein, J., Gautman, K. and Boeker, W., 1994, The effects of board size and diversity on strategic change. Strategic Management Journal, 15, 241-250.
44. Gorman, M. and Sahlman, W. A., 1989, What do venture capitalists do? Journal of Business Venturing, 4, 231-248.
45. Gupta, A. K. and Sapienza, H. J., 1992, Determinants of venture capital firms' preferences regarding the industry diversity and geographical scope of their investments. Journal of Business Venturing, 7, 347-362.
46. Harrison, R. T. and Mason, C. M., 1992, The roles of investors in entrepreneurial companies: a comparison of informal investors and venture capitalists. In Churchill, N. C., Birley, S., Bygrave, W. D., Muzyka, D. F., Wahlbin, C. and Wetzel, W. E., Jr. (eds) Frontiers of Entrepreneurship Research (Babson Park, MA: Babson College) 388-404.
47. Harrison, D. A., MCLaughlin, M. E. and Coalter, T. M., 1996, Context, cognition, and common method variance: psychometric and verbal protocol evidence. Organizational Behavior and Human Decision Processes, 68, 246-261.
48. Heijltjes, M. G. and Witteloostuijn, A. van, 2003, Configurations of market environments, competitive strategies, manufacturing technologies and human resource management policies: a two-industry and two-country analysis of fit. Scandinavian Journal of Management, 18, forthcoming.
49. Hermalin, B. and Weisbach, M., 2001, Boards of directors as an endogenously determined institution: a survey of the economic literature, NBER working paper, no. 8161.
50. Herron, L. and Robinson, R. B., 1993, A structural model of the effects of entrepreneurial characteristics on venture performance. Journal of Business Venturing, 8, 281-294.
51. Higashide, H. and Birley, S., 2002, The consequences of conflict between the venture capitalist and the entrepreneurial team in the United Kingdom from the perspective of the venture capitalist. Journal of Business Venturing, 17, 59-81.
52. Hollenbeck, J. and Whitener, W., 1988, Reclaiming personality traits for personnel selection. Journal of Management, 14, 81-91.
53. Huse, M., 2000, Boards of directors in SMEs: a review and research agenda. Entrepreneurship & Regional Development, 12, 271-290.
54. Jensen, M. C. and Meckling, W. H., 1976, Theory of the firm: managerial behavior, agency costs and ownership structure. Journal of Financial Economics, 3, 305-360.
55. Johnson, G. and Scholes, K., 2002, Exploring Corporate Strategy: Text and Cases (Harlow: Pearson Education).
56. Landström, H., 1993, Agency theory and its application to small firms: evidence from the Swedish venture capital market. Journal of Small Business Finance, 2, 203-218.
57. Lieberman, M. B. and Montgomery, D. B., 1998, First-Mover (Dis)Advantages: Retrospective and Link with the Resource-Based View. Strategic Management Journal, 19, 1111-1125.
58. Kets de Vries, M. F. R., 1977, 'The entrepreneurial personality: a person at the crossroads'. Journal of Management Studies, 14, 34-57.
59. MacMillan, I. C., Kulow, D. M. and Khoylian, R., 1988, Venture capitalists' involvement in their investments: extent and performance. Journal of Business Venturing, 4, 27-47.
60. Maijoor, S. J. and Witteloostuijn, A. van, 1996, An empirical test of the resource-based theory: strategic regulation in the Dutch audit industry. Strategic Management Journal, 17, 549-569.
61. Manigart, S., Sapienza, H. J. and Vermeir, W. 1995, Venture capital: méér dan enkel financiering? - een vergelijkend onderzoek in vier landen. M & O: tijdschrift voor organisatiekunde en sociaal beleid, 2, 72-90.
62. Miller, D., 1981, Toward a new contingency approach: the search for organizational gestalts. Journal of Management Studies, 18 (1), 1-26.
63. Miller, D., 1988, Relating Porter's business strategies to environment and structure: analysis and performance implications. Academy of Management Journal, 2, 280-308.
64. Miller, D. and Toulouse, J. M., 1986, Strategy, structure, CEO personality and corporate strategy and structure in small firms'. American Journal of Small Business, 10, 47-62.
65. Mintzberg, H., 1978, Patterns in strategy formation. Management Science, 24(9), 934-948.
66. Nesheim, J. L, 2000, High Tech Start Up - The Complete Handbook for Creating Successful New High Tech Companies (New York: Free Press).
67. Nooteboom, B., 1994, Innovation and diffusion in small firms: theories and evidence. Small Business Economics, 6 (5), 327-346.
68. Pennings, J. M., Lee, K. and Witteloostuijn, A. van, 1998, Human capital, social capital, and firm dissolution. Academy of Management Journal, 41, 425-440.
69. Penrose, E. T., 1959, The Theory of the Growth of the Firm (John Wiley, New York).
70. Pfeffer, J. and Salancik, G. R., 1978, The External Control of Organizations (Harper & Row, New York).
71. Phares, E. J., 1976, Locus of Control in Personality, Morristown, NJ: General Learning Press.
72. Porter, M. E., 1980, Competitive Strategy: Techniques for Analyzing Industries and Competitors (New York: Free Press).
73. Porter, M. E., 1985, Competitive Advantage: Creating and Sustaining Superior Performance (New York, Free Press).
74. Porter, M. E., 1991, Towards a dynamic theory of strategy. Strategic Management Journal, 12, 95-117.
75. Porter, M. E., 1996, What is strategy? Harvard Business Review, November-December, 61-78.
76. Postma, Th. J. B. M. and P.S. Zwart, 2001, Strategic research and performance of SMEs. Journal of Small Business Strategy, 12, 1-13.
77. Rindova, V. P., 1999, What corporate boards have to do with strategy: a cognitive perspective. Journal of Management Studies, 36, 953-975.
78. Roper, S., 1998, Entrepreneurial characteristics, strategic choice and small business performance. Small Business Economics, 11 (1), 11-24.
79. Rosenstein, J., Bruno, A. V., Bygrave, W. D. and Taylor, N. T., 1993, The CEO, venture capitalists, and the board. Journal of Business Venturing, 8, 99-113.
80. Rotter, J. B., 1966, Generalized expectancies for internal versus external control of reinforcement. Psychological Monographs: General and Applied, 80, whole number 609.
81. Sandberg, W. R., 1986, New Venture Performance: The Role of Strategy and Industry Structure (Lexington MA: DC Heath).
82. Sapienza, H. J., Korsgaard, M. A. and Goulet, P. K. and Hoogendam, J. P., 2000, Effects of Agency Risks and Processes in Venture Capital-Backed Firms. Entrepreneurship & Regional Development, 12, 331-351.
83. Sapienza, H. J., Manigart, S. and Vermeir, W., 1996, Venture capitalist governance and value added in four countries. Journal of Business Venturing, 11, 439-469.
84. Sapienza, H. J. and Timmons, J. A., 1989, The roles of venture capitalists in new ventures: what determines their importance? Academy of Management Best Papers Proceedings, 74-78.
85. Selznick, P., 1957, Leadership in Administration: A Sociological Perspective (Harper & Row, New York).
86. Shank, J. K. and Govindarajan, V., 1993, Strategic Cost Management - The New Tool for Competitive Advantage (The Free Press, New York).
87. Siegel, R., Siegel, E., and MacMillan, I. C., 1993, Characteristics distinguishing high-growth ventures Journal of Business Venturing, 8, 169-180.
88. Smart, G. H., 1999, Management assessment methods in venture capital: an empirical analysis of human capital valuation. Venture Capital: An International Journal of Entrepreneurial Finance, 1 (1), 59-82.
89. Stiles, P. and Taylor, B., 2001, Boards at work (Oxford University Press, Oxford).
90. Stuart, R. and Albetti, P. A., 1990, Impact of entrepreneurial and management experience on early performance. Journal of Business Venturing, 5, 151-162.
91. Tirole, J., 2001, Corporate governance, Econometrica. 69, 1-35.
92. Venkatraman, N. 1989, The concept of fit in strategy research: toward verbal and statistical correspondence. Academy of Management Review, 3, 423-444.
93. Williamson, O. E., 1996, The Mechanisms of Governance (Oxford University Press, New York).
94. Zacharakis A. L. and Meyer, G. D., 1998, A lack of insight: do venture capitalists really understand their own decision process? Journal of Business Venturing, 13, 57-76.
95. Zahra, S., 1996a, Technology strategy and new venture performance: a study of corporate-sponsored and independent biotechnology ventures. Journal of Business Venturing, 11, 289-321.
96. Zahra, S. A., 1996b, Governance, ownership, and corporate entrepreneurship: the moderating impact of industry technological opportunities. Academy of Management Journal, 9, 1713-1735.
97. Zahra, S. A., Pearce, J. A., 1989, Boards of directors and corporate financial performance: a review and integrative model. Journal of Management, 15 (2), 291-334.
98. Zollo, M. and Winter, G., 2002, Deliberate learning and the evolution of dynamic capabilities. Organization Science, 13 (3), 339-351.