Three Essays on Innovation and Entrepreneurship

Abstract

Startups play a central role in the development and diffusion of new technologies, often advancing innovation at the frontier while operating under conditions of uncertainty, limited resources, and institutional change. Understanding how these firms make strategic decisions related to technology development, knowledge exchange, and investment requires attention to both internal organizational characteristics and external environmental influences. The following three essays examine the mechanisms through which startups engage with technological innovation and make strategic choices across different contexts. Together, they contribute to a deeper understanding of the interplay between founder backgrounds, interorganizational relationships, and institutional structures in shaping innovation outcomes. The first essay focuses on the relationship between founders’ prior work experiences and the novelty of technologies developed by their startups. Existing research has emphasized the role of prior experience in enhancing innovative capacity, but less is known about how the nature of that experience influences the direction of technological search. This essay distinguishes between different sources of prior experience, such as large incumbents, universities, or cross-industry settings, and theorizes their effects on the development of novel technologies over the course of a startup’s lifecycle. The analysis demonstrates that experience in incumbent firms tends to constrain novelty during the early and growth phases, whereas university-based experience contributes positively to novelty at the initial stage. Cross- industry experience shows delayed benefits, enhancing novelty in later stages. These findings contribute to research on imprinting, learning, and innovation trajectories by identifying heterogeneous and time- dependent effects of founder experience. The second essay examines knowledge spillovers from startups to incumbent firms, with a focus on the conditions under which startup-originated technologies are adopted by established industry players. Drawing on perspectives from innovation diffusion and interorganizational learning, the essay argues that spillovers are shaped by both the characteristics of the knowledge being transferred and the relationships between the knowledge sender and receiver (Supply- and Demand-side factors). Technologies that are more novel are generally less likely to be cited by incumbents due to their higher complexity and evaluative uncertainty. However, when startups are financially linked to incumbents through investment ties—particularly corporate venture capital—these barriers are reduced. The presence of prior investment relationships facilitates greater exposure, alignment of interests, and mutual awareness, increasing the likelihood of knowledge adoption. Moreover, incumbent firms with higher status are generally more active in citing startup technologies, although they exhibit lower engagement with highly novel inventions. These findings offer a more conditional understanding of how novelty, organizational status, and investment ties jointly shape patterns of knowledge diffusion. The third essay considers how changes in merger review policy affect startup financing outcomes. Specifically, it examines a regulatory threshold change that altered the conditions under which mergers and acquisitions were subject to antitrust scrutiny. The analysis posits that such changes influence early- stage investment by affecting expectations around exit pathways. When more acquisitions are exempt from regulatory review, early-stage startups become more susceptible to acquisition before reaching technological maturity, weakening the case for long-term investor engagement. The essay shows that independent venture capital investment into early-stage startups declined following the policy change, while later-stage investment and corporate venture activity remained more stable. Additional analyses suggest that the decline was more pronounced for startups without strong reputational signals or prior funding history. These findings contribute to the literature on entrepreneurial finance and innovation policy by demonstrating that macro-level regulatory decisions can have selective and unequal effects across stages of startup development. Together, the three essays offer a theoretically grounded and empirically detailed account of how startups pursue innovation and adapt to institutional, relational, and organizational conditions. By focusing on the antecedents of novel technology development, the contingencies of knowledge spillovers, and the influence of policy on financing structures, the study advances understanding of strategic behavior in startup ecosystems. The findings contribute to research in strategic management, entrepreneurship, and innovation studies by clarifying the multilevel factors that shape the innovation trajectories of early-stage firms.