|Ph.D Student||Tal-Itzkovitch Sharon|
|Subject||The Emergence Process of New Technology Ventures in a|
Context of Multiple Strategic Alternatives
|Department||Department of Industrial Engineering and Management||Supervisors||Professor Emeritus Uzi De Haan|
|Professor Mark Groeber|
|Full Thesis text|
This research examines the emergence process of new technology ventures that face multiple strategic alternatives, by investigating one of the most profound decisions in new firms - their initial market entry choice. The extant literature commonly assumes that the need to focus drives startups to pursue a single market opportunity. However, by entering multiple markets at the same time and experimenting simultaneously with several options for value creation, entrepreneurs can spread their risk and achieve greater flexibility in their potential courses of action. Yet, this initial variety generating approach, which bears important implications for understanding how new ventures emerge and evolve, has been largely overlooked in prior studies. To fill this profound knowledge gap, a three stage research was conducted. First, through an in-depth, exploratory analysis of the emergence process of 25 new technology ventures, we found that different objectives push new ventures either towards a focused market-entry approach or to a variety-generating approach. We identified five distinct emergence types, and showed that the venture’s initial market-entry approach greatly influences its ability to adapt over time. Second, through surveying 219 technology startups across all industries, we found that attributes of the identified opportunity set and of the founding team play a major role in understanding what drives new ventures to adopt one approach over the other. Third, we examined the performance outcomes of 212 new ventures and found that variety generating through parallel experimentations are more beneficial when the alternative options are highly uncertain and when the founding team is equipped with the necessary knowledge to carry out such challenging strategy. Given their largely novel character, our findings offer several key insights for the organizational, entrepreneurship and strategic management literatures, as well as for practitioners.