How and Why Do Firms Differ at Start-Up? A Resource-Based Configurational Perspective

This paper studies what initial resource endowments new organizations assemble and the interaction between initial resources, entrepreneurial orientation and environmental factors. More specifically, we study the initial resources of research-based start-ups (RBSUs), which are defined as new firms that develop and market new products or services based upon a proprietary technology or skill. Using a unique hand-collected dataset of RBSUs in Belgium, we empirically test how technological, financial and human resources relate to each other to form distinct starting resource configurations. We find four different types of starting configurations: “Venture Capital-backed start-ups,” “Prospectors,” “Product start-ups” and “Transitional start-ups”. This study shows that these different types of starting resource configurations are not only empirically distinct but can also be conceptually explained by internal factors such as the entrepreneurial orientation at start-up and external factors such as the origin of the firm and the characteristics of the industry in which the firm competes.