The effects of early stage resources acquisition

Obtaining rigorous evidence on the impact of resource acquisition is not easy given the empirical challenges that limit causal inference. These challenges include omitted variable bias (e.g., unobserved ability could be driving changes in performance and strategic orientation decisions), self-selection bias (decisions to seek certain resources could be influenced by reasons unknown to the researcher), or reverse causality issues (e.g., better performance or strategic orientation decisions may be required first so that an entrepreneur can acquire a certain resource). To address these empirical challenges, I will implement a process field experiment. Such an experiment tests the process underlying why we think resource acquisition influences venture performance and its strategic orientation, and analyses which mechanism (financial capital, entrepreneurial capital, or both) is more important. A trade-off could exist in accessing these resources and I consider these various trade-offs explicitly in the research design in order to identify the “active ingredient” in the process of early-stage resource acquisition.

To test experimentally the effects of resource acquisition, I will implement two treatments. In addition to having a control group (“T0: Control Group”), I will implement (1) access to entrepreneurial capital (“T1: Entrepreneurial capital”) and (2) access to financial capital and entrepreneurial capital (“T2: Financial capital & Entrepreneurial capital”). I stratify the randomization according to venture and founder characteristics (industry, resource endowment, and gender) to ensure creating groups with similar observable characteristics.