New technology-based firms (NTBFs) face resource scarcity, especially in their early start-up phase. To perform well, these firms need to utilise existing resources and position themselves at par with other firms in order to acquire the resources they lack. This chapter examines the effects of NTBFs’ human capital and external relations on early performance (sales and employment). Although small firms possess some bundles of resources to develop themselves, NTBFs in particular need to access resources that often lie outside corporate boundaries. A survey was administered in 2016 to 401 small and young Swedish NTBFs (with an employment mean of 1.80 and an average age of 28.3 months). The authors show that founders’ business experience positively affects early business performance. They also conclude that in their very early stages, NTBFs may benefit from utilising their human capital and external relations.
Hanna Rydehell, Anders Isaksson and Hans Löfsten
Heikki Rannikko, Erno Tornikoski, Anders Isaksson, Hans Löfsten and Hanna Rydehell
This chapter investigates the survival and growth trends in a cohort of new technology-based firms (NTBFs) established in Sweden in 2006. We make several contributions to the current understanding of NTBF survival and growth. First, our empirical observations show that many firms (70 per cent) from the 2006 cohort of NTBFs were still operating at the end of 2014, a much higher survival rate than found in previous studies. Second, very few firms experience high growth during their first seven years, and employment growth and sales growth are highly correlated among high-growth firms. Third, challenges of measuring growth in new and very small firms using the ‘kink-point’ approach are addressed.