Browsing by Author "Townsend, David M."
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Item Bringing It All Back Home: Corporate Venturing and Renewal Through Spin-ins(2019) Hunt, Richard A.; Townsend, David M.; Asgari, Elham; Lerner, Daniel A.More often than not, corporate acquisitions are expensive and difficult, especially those transacted for the purpose of advancing the aims of corporate entrepreneurship (CE). Motivated by frequent, high-cost failures, firms are experimenting with novel organizational structures and fresh approaches to acquisition-driven CE. In this study, we examine the effectiveness of corporate spin-ins—acquisitions in which the acquired company is founded by former employees of the acquiring firm—in resolving key challenges of CE-motivated acquisitions Using a matched pairwise dataset of spin-in and non-spin-in acquisitions, we discover that spin-ins generate superior outcomes, positioning them as a high-potential facet of CE portfolios.Item Parental endowments versus business acumen: Assessing the fate of low-tech, service-sector spinouts(2019) Hunt, Richard A.; Lerner, Daniel A.; Townsend, David M.Research Summary In recent years, scholarship on intraindustry entrepreneurial spinouts has coalesced around a heredity‐focused perspective, propounding the notion that spinouts from high‐quality parent‐firms outperform those emanating from low‐quality parent‐firms. This view has found strong support in high‐tech sectors, but it is unclear whether parental lineage is a determinant of performance and survival in sectors exhibiting low‐technological dynamism, especially when the locus of value creation stems from generalist rather than technical‐specialist knowledge. Applying the knowledge spillover theory of entrepreneurship and jack‐of‐all‐trades framework, we assess the fate of a complete population of 678 service‐sector firms for the entire 32‐year history of an industry. Our study offers explanatory mechanisms that more fully account for the non‐hereditary success factors driving performance heterogeneity among entrepreneurial spinouts. Managerial Summary In many industries, half or more of the firms are founded by former employees of existing companies (i.e., “entrepreneurial spinouts”). In high‐tech sectors, these “spinouts” often appear to perform better than entrants without prior industry experience. Moreover, spinouts spawned by high‐performing parent‐firms tend to out‐perform spinouts from low‐performing parents, suggesting that spinouts benefit from advantageous parental knowledge and capabilities. However, this does not seem to be the case among spinouts in industries characterized by low‐technological dynamism. Our findings indicate that when technological dynamism is low, general business acumen eclipses parental lineage in determining spinout performance. In these cases, spinout founders with primarily technical experience would be well‐served by partnering with individuals possessing experience in marketing, sales, and day‐to‐day business management.Publication Pivot, persist or perish? Knowledge problems and the extraordinarily tight boundary conditions of entrepreneurs as scientists(2024) Hunt , Richard A.; Townsend, David M.; Lerner, Daniel A.; Brownell, Katrina M.The characterization of entrepreneurs as scientists (EaS) has become increasingly popular among management scholars because it fits neatly with existing theories of entrepreneurial action grounded in the assumption that entrepreneurs form and test beliefs in an intendedly rational fashion, under conditions of uncertainty, while continually seeking to obtain and process new information. Recent scholarship breathes new life into the EaS paradigm by proposing a framework that builds upon pragmatism in developing a microfoundational perspective concerning causally inferential action and rationality-based heuristics. Yet, the drift towards EaS is not without controversy. Business venturing is rarely analyzable through the lens of natural laws and orderly structures. Moreover, uncertainty is not the only knowledge problem (KP) that entrepreneurs confront. As such, EaS may be ineffective in bringing resolution to these other challenging KPs – ambiguity, complexity, and equivocality – especially when entrepreneurs are entertaining decisions to pivot or persist. In this sense, our work underscores the importance of EaS while also asserting the need for clear boundary conditions.