Same Difference? The impact of Low-, Medium-, and High-Tech Industries on Venture Performance and Survival

Despite the influence that industry has on organizational outcomes, there remains a shortage of research regarding the interaction between an entrepreneur's human capital (prior startup experience) and venture credit risk on new venture exit. Using data from the Kauffman firm survey, for ventures in high-tech industries, relative to ventures in low-tech industries, the decline in performance is stronger for founders who founded a greater number of businesses prior to the current venture or for those who have startup experience in the current industry. The differences in survival between high-tech and low-tech ventures is negligible when founders have more start up experience in the same industry. Furthermore, ventures in high-tech sectors with high credit risk have a greater performance decline relative to those in low-tech industries with high credit risk, and ventures in low-tech sectors with higher perceived competitive advantage have higher odds of failure. The findings add to our understanding of the influence of technology regimes on the limited efficacy of entrepreneurial human capital and stronger effects of credit risk on venture survival and performance.