Longitudinal panel study reveals distinct impacts of initial versus follow-on corporate venture capital rounds on innovation types, highlighting the strategic role of investment timing.
Key Points
To investigate how the timing of corporate venture capital investments across staged rounds and the relatedness of industries influence product and business model innovations.
Analyzed longitudinal panel data from 708 firms spanning from 2005 to 2019.
Evaluated the differential effects of first versus follow-on investment rounds on distinct innovation outcomes, testing industry relatedness as a moderating factor.
First-round venture investments significantly drive product innovations, with effects amplified when targeting industry-related startups.
Follow-on venture investments primarily foster business model innovations, with effects strengthened when investing in unrelated industries.