Parental Network Imprinting in Spinoffs: Understanding the Underlying Mechanisms

Fazlelahi, Forough Zarea; Obschonka, Martin; Davidsson, Per; Burgers, Henri

doi:10.5465/ambpp.2019.11881abstract

Cited by 1 publication

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“…While our paper primarily focuses on parent reputation as the determinant of network status for spinoffs, it may be plausible that the extent of the parent's network also plays a role in spinoff success as well (Zarea Fazlelahi et al, 2019, 2022. This arises from the possibility that the founders of the spinoff leverage their connections developed during their tenure at the parent company to establish new connections for the spinoff.…”

Section: Parent Network Sizementioning

confidence: 99%

Imprinting parental signals: a key driver of network status for new spinoff firms

Zarea,

Burgers,

Obschonka

et al. 2024

Small Bus Econ

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Although past research has firmly established the positive effects of network status for resource acquisition and success in entrepreneurial endeavors, we still have a fragmented, limited understanding of the actual drivers of network status emergence. Prior research has mainly focused on the post-founding phase, pointing to the importance of current employment–based and firm-level affiliations in new ventures for their future status formation. In this paper, we extend the attention to the pre-founding phase in a study of spinoffs. Building on imprinting and signaling theories, we theorize that coming from a highly reputable parent firm has a long-term positive impact on a spinoff’s subsequent status by signaling a young spinoff firm’s quality to external parties. We advance previous research by further theorizing that such imprinting is contingent on the level of knowledge relatedness between the parent and spinoff as well as on whether there exists a strategic alliance between them post-founding. In addition, we argue a positive three-way interaction among parent reputation, parent-spinoff knowledge relatedness, and the parent-spinoff strategic alliance. Our analysis of a comprehensive longitudinal sample of 162 Australian mining spinoffs (i.e., firms started by ex-employees of incumbent parent firms) and 3405 strategic alliances from 2001 to 2014 supports majority of our hypotheses.

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Section: Parent Network Sizementioning

confidence: 99%