The role of market knowledge in recognizing and exploiting entrepreneurial opportunities in technology intensive firms

Authors

Anna-Maija Renko, Florida International UniversityFollow

Document Type

Dissertation

Major/Program

Business Administration

First Advisor's Name

Sumit K. Kundu

First Advisor's Committee Title

Committee Chair

Second Advisor's Name

Alan L. Carsrud

Second Advisor's Committee Title

Committee Member

Third Advisor's Name

Paul D. Reynolds

Third Advisor's Committee Title

Committee Member

Fourth Advisor's Name

Ronald M. Lee

Fourth Advisor's Committee Title

Committee Member

Keywords

opportunity exploitation, opportunity recognition, entrepreneurship, biotechnology

Date of Defense

3-7-2008

Abstract

Entrepreneurial opportunity recognition is an increasingly prevalent phenomenon. Of particular interest is the ability of promising technology based ventures to recognize and exploit opportunities. Recent research drawing on the Austrian economic theory emphasizes the importance of knowledge, particularly market knowledge, behind opportunity recognition. While insightful, this research has tended to overlook those interrelationships that exist between different types of knowledge (technology and market knowledge) as well as between a firm’s knowledge base and its entrepreneurial orientation. Additional shortfalls of prior research include the ambiguous definitions provided for entrepreneurial opportunities, oversight of opportunity exploitation with an extensive focus on opportunity recognition only, and the lack of quantitative, empirical evidence on entrepreneurial opportunity recognition. In this dissertation, these research gaps are addressed by integrating Schumpeterian opportunity development view with a Kirznerian opportunity discovery theory as well as insights from literature on entrepreneurial orientation. A sample of 85 new biotechnology ventures from the United States, Finland, and Sweden was analyzed. While leaders in all 85 companies were interviewed for the research in 2003-2004, 42 firms provided data in 2007. Data was analyzed using regression analysis. The results show the value and importance of early market knowledge and technology knowledge as well as an entrepreneurial company posture for subsequent opportunity recognition. The highest numbers of new opportunities are recognized in firms where high levels of market knowledge are combined with high levels of technology knowledge (measured with a number of patents). A firm’s entrepreneurial orientation also enhances its opportunity recognition. Furthermore, the results show that new ventures with more market knowledge are able to gather more equity investments, license out more technologies, and achieve higher sales than new ventures with lower levels of market knowledge. Overall, the findings of this dissertation help further our understanding of the sources of entrepreneurial opportunities, and should encourage further research in this area.

Identifier

FI08081539

Recommended Citation

Renko, Anna-Maija, "The role of market knowledge in recognizing and exploiting entrepreneurial opportunities in technology intensive firms" (2008). FIU Electronic Theses and Dissertations. 38.
https://digitalcommons.fiu.edu/etd/38