The inside track: Entrepreneurs' corporate experience and startups' access to incumbent partners' resources

Startups are increasingly turning to incumbent firms for venture capital, anticipating access to the investor's knowledge and complementary assets. However, startups' eventual access to these resources varies widely. This article highlights one important driver of such variance, whether startups' managers were previously employed by an incumbent in the same industry. Using data from the life sciences, I find that such corporate experience can precipitate technical knowledge flows to startups by enabling the generation of relational capital with incumbent firm managers. It also helps startups navigate incumbents' decision-processes to formalize access to downstream complementary assets via alliances. The former effect is stronger when corporate experience is technology-focused, the latter when it is commercialization-focused. Corporate experience at the investing incumbent firm amplifies informal knowledge-flows but not formal alliances.