Venture Capitalists and Cooperative Start-Up Commercialization Strategy

38 Pages Posted: 29 Nov 2004

See all articles by David H. Hsu

David H. Hsu

University of Pennsylvania - Management Department

Multiple version iconThere are 2 versions of this paper

Date Written: November 22, 2004


I examine the possible impact of venture capital (VC) backing on the commercialization direction of technology-based start-ups by asking: to what extent (if at all) do VC-funded start-ups engage in cooperative commercialization strategies (strategic alliances and/or technology licensing) relative to a comparable set of start-ups, and with what consequences? To address these questions, I assemble a novel dataset that matches firms receiving a federal research and development subsidy through the Small Business Innovative Research program to VC-funded firms by observable characteristics in five technology-intensive industries. This method helps decouple cooperative activity resulting from start-up development associated with the passage of calendar time from that due to association with VCs. An analysis of the 696 start-ups in the sample (split by external funding source) suggests substantial boosts in cooperative activity associated with VC-backed firms, as well as a number of start-up performance implications.

Keywords: Entrepreneurial ventures, venture capital, cooperation, commercialization strategy, strategic alliances, initial public offerings

JEL Classification: M13, M21, O32, G24, G30, L14

Suggested Citation

Hsu, David H., Venture Capitalists and Cooperative Start-Up Commercialization Strategy (November 22, 2004). Available at SSRN: or

David H. Hsu (Contact Author)

University of Pennsylvania - Management Department ( email )

The Wharton School
Philadelphia, PA 19104-6370
United States
215-746-0125 (Phone)
215-898-0401 (Fax)

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