Academics JVB Blog Academics JVB Blog

Don't mind me, Boss, if I become your Next Competitor

The study analyzes how the market overlap between startups founded by former employees of parent organizations affects their performance. The researchers propose that market overlap has a curvilinear relationship with the likelihood of survival of spin-outs. The previous hierarchical position of founders moderates this relationship. Market overlap helps reduce uncertainty, but too much overlap may lead to hostile actions by parent organizations, creating disruptive competition that lowers spin-outs' survival. The study uses European biotech spin-outs and their parent firms as a sample and finds support for the hypotheses.

Read More