Smaller technology-based firms are critical for many economies. This study investigates the determinants of performance in a sample of 110 firms from the information and communication technology (ICT) industry in New Zealand. It is a single industry study, reflecting the industry-specificity of resource-based capabilities. Partial Least Squares methods are used to investigate relationships between capabilities, strategy and performance. A product innovation strategy maximised performance, mediating both innovation and human capital capabilities. Pursuing a market expansion strategy ahead of one of product innovation led to inferior performance outcomes. Financial and organisational capabilities had direct positive effects on performance irrespective of strategy.