Frontiers of Entrepreneurship Research
1997 Edition

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INITIAL STRATEGIES AND NEW VENTURE GROWTH:  AN EXAMINATION  OF THE EFFECTIVENESS OF BROAD VS. NARROW BREADTH STRATEGIES
Charles E. Bamford, Texas Christian University
Thomas J. Dean, University of Oregon
Patricia P. McDougall, Georgia Institute of Technology

INTRODUCTION
THEORETICAL DEVELOPMENT
    Breadth and New Venture Growth
METHODOLOGY
RESULTS
DISCUSSION & CONCLUSIONS
REFERENCES
TABLE 1
TABLE 2
 

ABSTRACT

Extant new entry theory has long suggested a narrow breadth strategy for new venture success while most empirical research has found that broad strategies are the key to success for new ventures. Research examining almost 500 independent, new ventures at the point of founding and performance data obtained five years later suggests that broad strategies do indeed appear to be better. In addition, while there is an interaction effect between the product strategy and initial capital, a significant finding of this study is how important initial capital is as a predictor of new venture growth across strategies.

 
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