Continuing opportunity recognition in young ventures—the role of founder and joiner experience

Abstract

We analyze the continuing role of prior technical experience of top-management team (TMT) members for opportunity recognition beyond the initial market entry choice in young ventures. We are drawing on and extending the theory of opportunity recognition by studying continuing opportunity recognition and by distinguishing the roles of founders and joining TMT members. Specifically, we investigate the recognition of digital opportunities by young ventures initially focused on a non-digital offering for a sample of 6672 firms. First, our study shows that founders’ prior technical experience influences opportunity recognition beyond the time of founding. Second, whereas founders contribute to opportunity recognition with both general and specialized prior knowledge, joining TMT members have a narrower role because for them just specialized prior knowledge is relevant. We contribute to the entrepreneurship literature by providing a more nuanced understanding of the role of prior knowledge for opportunity recognition.