The knowledge‐based view of the firm is a recent approach to understanding the relationship between firm capabilities and firm performance. Specifically, this approach suggests that knowledge generation, accumulation and application may be the source of superior performance. Other research has conceptualized organizational knowledge in terms of stocks of accumulated knowledge in the firm and flows of knowledge into the firm. This paper tests the relationship between stocks and flows of organizational knowledge and firm performance in the biotechnology industry. We suggest that a firm’s geographic location, alliances with other institutions and organizations and R&D expenditures are representative of knowledge flows, while products in the pipeline, firm citations and patents are indicative of knowledge stocks. Through factor analysis, we develop an aggregated measure of location from several variables. A regression model suggests that location is a significant predictor of firm performance as are products in the pipeline and firm citations. A major contribution of this investigation is the operationalization of geographic location and its statistically significant link to firm performance. Copyright © 1999 John Wiley & Sons, Ltd.

No abstract

This paper develops a model of the total level of capital raised by biotech IPOs based on the timing of the offering and the scientific capabilities of the firm. The results indicate a positive relationship between the amount of capital raised by an IPO and the timing of the offering and the scientific capabilities of the firm.

We explore the relationship between wealth creation in high-technology ventures and firm-specific resources. We argue that Market Value Added is a particularly appropriate measure of entrepreneurial performance because of its focus on wealth creation, which is the essence of entrepreneurship. We present a model of wealth creation in new ventures based on the resource-based theory of firm behavior. The model suggests that firm-specific research and scientific capabilities are associated with wealth creation. The model is tested on a sample of 89 biotechnology firms. The results provide strong evidence for the hypothesized relationship between firm-specific capabilities and wealth creation in new ventures.

No abstract