Strategic alliances and firm performance in startups with a social mission

Abstract

Innovation with a social purpose is strictly linked to entrepreneurship and economic development. However, those startups that pursue a social mission often operate in really novel markets and raise some scepticism in the eyes of investors. Startups can improve their business performance by leveraging on equity and non-equity based strategic alliances, so to pursue growth. However, sustainable growth requires to attract the right investments at the right stage of development of the startup. This study draws on international business theory and proposes a novel framework that explains the mechanisms regulating strategic alliances and firm performance in a startups context. We use a sample of 3,913 UK high-tech startups engaging in social innovation to test our hypotheses and we derive an explanation for some of the mechanisms behind strategic alliances effect on startups performance, startups scalability and the balance needed between performance and the pursuit of a social mission