Technological fit, control rights allocation, and innovation performance of corporate venture capital-backed enterprises

Harmonizing corporate venturing dimensions and its characteristics: a systematic analysis

“…Operational autonomy defines ventures' integration level and dependencies towards the corporation (Burgers et al 2009;Johnson 2012;Garrett and Covin 2015;Waldkirch et al 2021). The dimension can be described by multiple factors, including financial support through funding (Pauwels et al 2016;Wang et al 2021), and non-financial support through formal and informal linkages of operations (Burgers et al 2009;Johnson 2012), employee mobility (Kim and Steensma 2017;Cirillo 2019), mentoring, networking, and facility services (Sorrentino and Williams 1995;Kanbach and Stubner 2016;Shankar and Shepherd 2019), which enable synergies between the corporation and the venture (Haslanger et al 2022). Knowledge flow is also commonly represented either as patenting (Di Lorenzo and van de Vrande 2019) or by strategic alliances, such as licensing or collaborative R&D (Gonzales and Ohara 2019;Kang et al 2021).…”

“…Strategic autonomy is based, on the one hand, on the discretion of a corporation, which implies that it can control the venture, and on the other hand, which influence the corporation is taking in the strategic decision-making of ventures (Waldkirch et al 2021). Especially the ownership structure and board representation are often considered important factors determining strategic autonomy (Yang 2012; Paik and Woo 2017;Hussinger et al 2018;Wang et al 2021) besides being considered a source of knowledge transfer for the corporation (Dushnitsky and Lenox 2005;Yang 2012). Thus, the benefits and risks regarding strategic autonomy for startups and corporations must be considered carefully (Maula et al 2009).…”

“…This can be implemented by having a board member or a chairman from the parent on the board of management. Wang et al (2021) analyze the obtained control rights by a corporation on three different levels, averaging the indicators of the proportion of CVC seats on the board of directors, the board of supervisors, and a place in the management. They find that startups give corporate investors more control rights when they have complementary technologies, and more importantly, the obtained control rights positively affect the innovation outputs of the venture.…”

“…In addition to the equity stake, the number of board seats is often considered a relevant characteristic of autonomy (Maula et al 2009;Wang et al 2021). However, board seats are also a way for corporations to monitor venture's technology developments (Dushnitsky and Lenox 2005), while the equity involvement is primarily concerned about control and financial returns (Kohler 2016;Hussinger et al 2018;Huang and Madhavan 2021).…”

Does the Type of Funding Affect Innovation? Evidence from Incubators in China

“…Compared with financial subsidies, VC directly participates in enterprises' management. It applies industry experience and resources to help enterprises improve governance structures and R&D decisions to enhance innovation value [41,42]. Based on the industry perspective, Kortum and Lerner (2000) studied the impact of VC on the patented inventions of twenty industries in the United States and found that more patents often accompany increased venture capital [43].…”