Corporate Entrepreneurship: Nothing Ventured, Nothing Gained?

28 Pages Posted: 25 Nov 2008

See all articles by Julian Birkinshaw

Julian Birkinshaw

London Business School

Susan A. Hill

Cass Business School, City University London

Gordon C. Murray

University of Exeter Business School

Date Written: August 2004

Abstract

Recent literature has suggested that adopting elements of the organization of independent venture capital (VC) firms may enhance the performance of corporate venture (CV) units (Chesbrough, 2000; Sahlman, 1990). This assertion has only been subject to minimal empirical research: typically restricted to small-sample qualitative studies or to examining the respective influences of independent VC firms and CV units on the performance of portfolio firms (Gompers & Lerner, 1998; Maula & Murray, 2001).

A longitudinal survey of 95 CV units across three continents found mixed empirical support for the suggestion. Of the VC structures and practices investigated, strongest support was found for CV unit engagement with the VC community which was consistently associated with superior corporate venturing performance along both strategic and financial dimensions. VC-like equity-based compensation systems were not found to influence CV performance even where CV units were strongly focused on financial goals. Overall, the adoption of VC practices, partially mediated by venture unit performance, was positively associated with CV unit survival. These results suggest that selective adoption of elements of the VC model may enhance CV unit performance and survival.

Suggested Citation

Birkinshaw, Julian and Hill, Susan A. and Murray, Gordon C., Corporate Entrepreneurship: Nothing Ventured, Nothing Gained? (August 2004). Advanced Institute of Management Research Paper No. 006. Available at SSRN: https://ssrn.com/abstract=1306928 or http://dx.doi.org/10.2139/ssrn.1306928

Julian Birkinshaw (Contact Author)

London Business School ( email )

Sussex Place
Regent's Park
London, London NW1 4SA
United Kingdom

Susan A. Hill

Cass Business School, City University London ( email )

106 Bunhill Row
London, EC1Y 8TZ
United Kingdom

Gordon C. Murray

University of Exeter Business School ( email )

Streatham Court
Rennes Drive
Exeter EX4 4PU
United Kingdom
+44 777 522 0857 (Phone)

HOME PAGE: http://business-school.exeter.ac.uk/staff/profile.php?id=34

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