The Birth of a New Industry: Entry by Start-ups and the Drivers of Firm Growth. The Case of Encryption Software

The paper analyses the birth of the Encryption Software Industry (ESI), a new niche in the software industry. Using a Chandlerian perspective, this work reports the main facts about firm entry and growth, with a particular focus on start-up strategies and actions. Since scale economies do not play a major role in ESI, the paper investigates the different sources of firm competitive advantages. This work shows that innovation and product differentiation, along with investments in co-specialised assets, are variables strongly correlated to young firm probability to survive and grow. In so doing, we have collected highly detailed information on product introduction, US patents granted, worldwide alliances and biographical data of firm founders.Entry, Entrepreneurship, Innovation, Software.

EU Patent System: to be or not to be?

This paper introduce a list of desirable efficiency properties that any a patent system should have in order to enhance innovation, trade competitiveness, employment mobility and economic growth. We briefly overview the literature on patents and discuss the advantages and disadvantages of the present and recent proposals for the future of the European Union Patents System. In particular, we discuss the costinefficiencies observed in the current design of the EU Patent System based in a double structure layer divided in a central European Patent Office (EPO) and several nationalbased patent offices. This paper analyzes the likely backlashes of creating a third layer for a subâ€sample of EU countries. The paper suggests an alternative more efficient Patent System together with some policy implications.Innovation, Patents, Knowledge spillovers, Common European patent, Welfare losses, Patents’ languages, Cultural proximity, Competitive trade

Product strategies and survival in schumpeterian environments: evidence from the US security software industry.

This paper seeks to explore the drivers of survival in environments characterized by high rates of entry and exit, fragmented market shares, rapid pace of product innovation and proliferation of young ventures. The paper aims to underscore the role played by postentry product strategies, along with their interaction, after carefully controlling for "at entry" factors and demographic conditions. Based on a population of 270 firms that entered the US security software industry between 1989 and 1998, we find evidence that surviving entities are those that are more aggressive in the adoption of versioning and portfolio broadening strategies. In particular, focusing on any one of these two strategies leads to a higher probability of survival as opposed to adopting a mixed strategy.Survival; Versioning; Portfolio broadening; Young ventures; Sotware;

PRODUCT STRATEGIES AND STARTUPS’ SURVIVAL IN TURBULENT INDUSTRIES: EVIDENCE FROM THE SECURITY SOFTWARE INDUSTRY

This paper seeks to explore the drivers of startups’ survival in turbulent industries, characterized by high rates of entry and exit, fragmented market shares, and a rapid pace of product innovation. Specifically, the paper aims to underscore the role played by post-entry product strategies, along with their interaction, beyond that of pre-entry conditions. Based on a sample of 270 startups that entered the Security Software Industry from 1989 till 1998, we find evidence that surviving entities are those that more aggressively adopt versioning and product portfolio strategies. Interesting enough, strategic learning seems to play a major role: Focusing on one of the two product strategies commands a higher survival probability than adopting a mixed strategy.

The birth of a new industry: entry by start-ups and the drivers of firm growth: The case of encryption software

The paper analyses the birth of the encryption software industry (ESI), a new niche in the software industry. Using a Chandlerian perspective, this work reports the main facts about firm entry and growth, with a particular focus on start-up strategies and actions. Since scale economies do not play a major role in ESI, the paper investigates the different sources of firm competitive advantages. This work shows that innovation and product differentiation, along with investments in co-specialised assets, are variables strongly correlated to young firm probability to survive and grow. In doing so, we have collected highly detailed information on product introduction, US patents granted, worldwide alliances and biographical data of firm founders.Publicad

Community-focused strategies.

This article introduces the notion of community-focused strategies to refer to the set of actions, activities and policies that firms undertake to establish connections or relational links with one or more target communities of (potential) customers. Drawing on social identity theory and strategy research, this study begins with a proposed taxonomy of different community-focused strategies. Then it illustrates how such strategies contribute to the creation of competitive advantage and explores their boundary conditions. Finally, the authors offer implications for theory development and practice, as well as suggestions for further research.Communities; Competitive advantage; Firm strategies; Identity;

Missing the starting gun: de alio entry order in new markets, inertia and real option capabilities

This article analyses entry order decisions of incumbent firms diversifying from other industries (de alio entrants) in new markets. We study this issue in the Security Software Industry, a high turbulent industry in which de alio firms were first technological movers but start-ups dominate the downstream product market. With a generalized Tobit estimation of observed entry order decisions, we find that pre-entry firm capabilities that should represent strategic options do not significantly explain firm entry order. The article argues that inertial decisions more than rational assessments drive de alio entry order in Security Software.Publicad