Frontiers in European Entrepreneurship Research
Edited by David Smallbone, Hans Landström and Dylan Jones-Evans
Chapter 4: Can New Ventures Develop Pioneer Behaviour in Industries with Unfavourable Conditions? The Role of Capabilities
Pedro M. García-Villaverde and María J. Ruiz-Ortega INTRODUCTION Most studies on entry timing have focused on analysing the direct and indirect influence of the moment of market entry on the firm’s performance (for example, Coeurderoy and Durand, 2004; Shamsie et al., 2004). We have found few empirical studies that focus on analysing the advantages and risks of entry timing for new ventures (for example, Shepherd et al., 2000; Williams et al., 1991). However, none of these empirical studies on the factors that influence entry timing is focused on new ventures (Mitchell, 1989; Robinson et al., 1992; Schoenecker and Cooper, 1998). We think that entry timing and entrepreneurship studies are strongly linked because of the shared need to compare windows of opportunity to gain competitive advantage and the liabilities of newness (Shepherd and Shanley, 1998). We believe that environmental conditions determine new ventures’ expectations to obtain first mover advantages and, therefore, bring about the moment of entry into the market (Covin et al., 2000). While the extant literature highlights the importance of the competitive dynamic, stating that the pioneer strategy can affect the competitive position of competitors in a relevant way (Geroski, 1995), we analyse the level of imitation and rivalry in the industry, which are two unfavourable environmental conditions to develop first mover advantages (Kerin et al., 1992). Following population ecology (Hannan and Freeman, 1977), new ventures that perceive important potential advantages of early entry tend to enter a new market quickly if they have suitable resources and...
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