Enhancing Supplier's Involvement in Startup's Innovation through Equity Offering and Trust Building

Michael Song, Ad de Jong, C. Anthony Di Benedetto, Y. Lisa Zhao

Publikation: Bidrag til tidsskriftTidsskriftartikelForskningpeer review

Resumé

External partners, such as suppliers, are important in the case of innovation by entrepreneurial startup firms. Due to their limited resources and liability of newness, these startups must rely on outside partners for resources and legitimacy to succeed and indeed to survive. Yet, few studies have specifically examined, or provided guidance on, how startups can increase supplier involvement in their innovation projects. Drawing from Transactional Cost Economics and supplier involvement literature, this study develops a contingency model, in which supplier's equity share and supplier's trust moderate the relationship of supplier's involvement in a startup's innovation with supplier's specific investment and startup's effort in qualification of supplier's ability. We empirically test the model using data collected from 166 innovation projects of 166 startups. Our results show that supplier involvement is pivotal to startup's product innovation performance, which is consistent with prior literature on supplier involvement. Interestingly, our results further reveal that supplier's specific investment and startup's effort in qualification of supplier's ability lead to higher levels of supplier involvement only when supplier's equity share and supplier's trust are sufficiently high.
OriginalsprogEngelsk
Artikelnummer1950013
TidsskriftInternational Journal of Innovation Management
Vol/bind23
Udgave nummer2
Antal sider29
ISSN1363-9196
DOI
StatusUdgivet - feb. 2019

Bibliografisk note

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Emneord

  • Supplier involvement
  • Entrepreneurial innovation
  • Transactional cost economics
  • Equity share
  • Supplier trust

Citer dette

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Enhancing Supplier's Involvement in Startup's Innovation through Equity Offering and Trust Building. / Song, Michael; de Jong, Ad; Di Benedetto, C. Anthony; Zhao, Y. Lisa.

I: International Journal of Innovation Management, Bind 23, Nr. 2, 1950013, 02.2019.

Publikation: Bidrag til tidsskriftTidsskriftartikelForskningpeer review

TY - JOUR

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AU - Song, Michael

AU - de Jong, Ad

AU - Di Benedetto, C. Anthony

AU - Zhao, Y. Lisa

N1 - CBS Library does not have access to the material

PY - 2019/2

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N2 - External partners, such as suppliers, are important in the case of innovation by entrepreneurial startup firms. Due to their limited resources and liability of newness, these startups must rely on outside partners for resources and legitimacy to succeed and indeed to survive. Yet, few studies have specifically examined, or provided guidance on, how startups can increase supplier involvement in their innovation projects. Drawing from Transactional Cost Economics and supplier involvement literature, this study develops a contingency model, in which supplier's equity share and supplier's trust moderate the relationship of supplier's involvement in a startup's innovation with supplier's specific investment and startup's effort in qualification of supplier's ability. We empirically test the model using data collected from 166 innovation projects of 166 startups. Our results show that supplier involvement is pivotal to startup's product innovation performance, which is consistent with prior literature on supplier involvement. Interestingly, our results further reveal that supplier's specific investment and startup's effort in qualification of supplier's ability lead to higher levels of supplier involvement only when supplier's equity share and supplier's trust are sufficiently high.

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