Overcoming the liability of patenting in early-stage ventures with market orientation

Early-stage ventures often face bounded rationality from a lack of experience as well as limited resources. A strategic choice to patent a firm's innovations to prevent competitor infringement involves significant resource commitments. We hypothesise that for early-stage ventures, having a pate...

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Bibliographic Details
Published inIndustry and innovation Vol. 31; no. 4; pp. 501 - 524
Main Authors Chen, Li-Wei, Welbourne Eleazar, Miranda J., Lee, Soo-Hoon, Islam, Habib A.
Format Journal Article
LanguageEnglish
Published Sydney Routledge 20.04.2024
Taylor & Francis Ltd
Subjects
Competition
early stage ventures
Entrepreneurship
Financial performance
Infringement
Innovations
Liability
liability of patenting
Market orientation
Orientation
Patenting
Rationality
Startups
Ventures
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Summary:Early-stage ventures often face bounded rationality from a lack of experience as well as limited resources. A strategic choice to patent a firm's innovations to prevent competitor infringement involves significant resource commitments. We hypothesise that for early-stage ventures, having a patent could create liability on short-term financial performance; however, higher levels of market orientation could overcome it. We find support for our hypotheses using a sample of early-stage ventures that apply to business accelerators for support. This study contributes to the extant literature on innovation and entrepreneurship, as well as on market orientation, to show that for early-stage ventures, a potential liability of patenting exists, but it can be mitigated by higher levels of market orientation.
ISSN:1366-2716
1469-8390
DOI:10.1080/13662716.2024.2320773