The Impact Of Corporate Venture Capital And Independent Venture Capital On New Product Development Performance Of Entrepreneurial Ventures

Entrepreneurial ventures(EVs)are important subjects to promote the innovation and development of our country.The key to whether EVs can play their role in innovation lies in the success of new product development(NPD).Although EVs have strong motivation to develop new products,they are facing a very high rate of failure in NPD due to resource constraints.As an important source of resources,venture capital in the capital market can effectively alleviate the NPD resource constraints of EVs,and it has become a key force affecting the successful development of new products of EVs.There are different types of venture capital in the capital market.Corporate venture capital(CVC)and independent venture capital(IVC)are the two main types of venture capital.CVC is an equity-type venture capital conducted by a non-financial company.It is a strategic investor that cares more about long-term strategic benefits.IVC is an equity-type venture capital conducted by a financial company.It is a financial investor that pursues short-term financial returns.They have different investment logics and resource endowments,which may cause different NPD results for EVs.This makes it difficult for EVs to judge which type of venture capital is more conductive to improving their NPD performance when making financing decisions.Existing research mainly discusses the role of different types of venture capital from the aspects of technological innovation and economic benefit,and obtains inconsistent results.Research on technological innovation finds that CVC can better promote firm performance,and research on economic benefit finds that IVC is more positive in improving firm performance.Although some important results have been achieved in existing research,there are also certain limitations.First,studies have explored the impact of venture capital on technological innovation and economic benefit of the invested firms based on the dimension of value,but they rarely consider the potential impact of venture capital on NPD risk of the invested firms based on the dimension of risk.Second,studies have analyzed the effect of venture capital on technological innovation input and output of the invested firms from a financial perspective,paying little attention to the effect of venture capital on marketing input and NPD performance of the invested firms from the perspective of finance-marketing interface.Third,studies have discussed the role of different types of resources of venture capital from the level of resource content,and seldom examine the overlapping relationship of network resources among firms invested by venture capital from the level of resource structure.In summary,to help EVs solve financing decision-making problems and reveal the value and risk of venture capital in depth,this study explores the influence and mechanism of CVC and IVC on NPD performance of EVs,including NPD benefit and NPD risk.First,the direct impact of CVC and IVC on NPD performance of EVs is explored based on the value-risk matrix.NPD performance is divided into NPD benefit and NPD risk from the dimensions of value and risk.The panel data of 903 EVs and 992 VCs are collected from multiple channels,and various methods such as fixed-effects model,Heckman’s two-step selection model,and instrumental variable approach are used to solve the potential endogeneity problems.It is found that CVC improves NPD benefit of EVs but also increases their NPD risk.IVC reduces NPD benefit but can decrease NPD risk.In contrast,CVC promotes NPD benefit while IVC reduces NPD risk.Next,the mediating roles of marketing investment and technology investment between different venture capital and NPD performance of EVs are examined from the perspective of strategic resource allocation.Using the path of external capital-internal resource allocation-resource allocation result,this study explores the mediating effect of two key strategic resource allocation between marketing and technology.On the basis of the original panel data,the marketing data of 12614 firms and the research and development data of 903 EVs have been added.It is found that technology investment and marketing investment will mediate the impact of CVC and IVC on NPD performance of EVs,respectively.Among them,CVC promotes EVs to invest more technology resources to improve their NPD benefit but also cause higher NPD risk.IVC promotes EVs to invest more marketing resources to reduce NPD risk.Finally,the moderating roles of innovation overlap and market overlap on the relationship between different venture capital and NPD performance of EVs are investigated from the perspective of network resource overlap.This study analyzes the moderating effects of innovation and market network resource overlaps among firms invested by venture capital built on the investment network of venture capital.On the basis of the original panel data,more than 700,000 patent data and 20,000 industry data have been added.It is found that innovation overlap enhances the positive effect of CVC on NPD benefit of EVs,and also reduces the negative effect of CVC on NPD risk.Market overlap weakens the negative effect of IVC on NPD benefit of EVs,and also strengthens the negative effect of IVC on NPD risk.This study has several important innovations.(1)A new research framework is built.Integrating institutional logic and resource-based theory,this study creates a research framework supported by venture capital,resource allocation,resource overlap and NPD performance,which provides a new theoretical basis and research path for exploring the impact and mechanism of venture capital.(2)The double-edged sword effects of venture capital are discovered based on the value-risk matrix.This study finds that venture capital is positive and can improve NPD benefit;it may also be negative and can induce NPD risk.(3)The dual perspectives of finance and marketing are combined to organize the relationship between venture capital and marketing.Built on the perspective of finance-marketing interface,this study explores the relationship between venture capital and the marketing of the invested firms from the levels of organization and industry.(4)The influencing mechanism of venture capital is revealed from the aspects of resource allocation and overlap.It is found that CVC and IVC have different effects on NPD performance of EVs,which mainly come from the mediating effect of different strategic resource allocation and the moderating effect of different network resource overlap.This research also has strong practical significance.In the management decisionmaking,it provides important practical implications for EVs’ managers to effectively solve the financing problems from venture capital,optimize the strategies of resource allocation,and improve the success rate of NPD.In terms of policy formulation,it also provides some valuable references for the formulation and implementation of financial support policies,entrepreneurial support policies,and innovation development policies.