Knowledge, innovation and NTBF short- and long-term performance

The purpose of this paper is to analyse the effect of knowledge resources stemming from the founding team's human capital and the access to external sources of knowledge available at or near the NTBF's inception on the venture's short- and long-term performance. Whether innovation is a vehicle through which knowledge resources have an impact on results is also studied. While previous studies have often focused on one dimension of performance, we cover complementary indicators of short-term performance (i.e., foreign market performance, total market performance and superior financial outcomes) and one indicator of long-term performance (TBF survival). Thus, the current research contributes to a wider understanding of the effect of knowledge resources at or near a venture's inception and innovation on the performance of NTBFs. A sample consisting of 175 Spanish NTBFs allows these relationships to be analysed. Results indicate that NTBFs' knowledge resources available at or near inception are of relevance to firms' innovations and to different dimensions of performance. Several knowledge resources have different positive and negative effects on different dimensions of short- and long-term performance, so those that can be good at one stage of a NTBF's life cycle can be bad at others times (e.g., founding teams with more members in the early years of the NTBF may be positive for the results, but in the long term, fewer people is better). Innovation mediates the effect of some knowledge resources on total market performance.