Rajshree Agarwal, Barry L. Bayus

Research output: Chapter in Book/Report/Conference proceedingChapter


New industries are created from the pioneering activities of a few firms. These firms generally face great uncertainty and risk, but also stand to benefit from early mover advantages due to the preemption of resources. Based on an empirical analysis of a diverse set of consumer and industrial innovations introduced in the U.S. over the past 100 years, we find that entrants during the pre-firm take-off stage (termed Creators) have higher survival rates than later entrants that enter between the firm and sales take-off (termed Anticipators), and both of these entrant types have higher survival rates than firms that enter after the sales take-off (termed Followers). Notably, survival rates for Creators and Anticipators do not depend on entry time within the cohort group, i.e. what matters is whether an entrant enters before or after the take-off, not whether it entered first in its cohort. Our results indicate that there is no real option value in waiting when one considers survival as a performance measure, which bodes well for firms interested in creating new industries.

Original languageEnglish (US)
Title of host publicationBusiness Strategy over the Industry Lifecycle
EditorsJoel A C Baum, Anita M McGahan
PublisherEmerald Group Publishing Ltd.
Number of pages24
ISBN (Print)0762311355, 9780762311354
StatePublished - 2004

Publication series

NameAdvances in Strategic Management
ISSN (Print)0742-3322

ASJC Scopus subject areas

  • Economics, Econometrics and Finance (miscellaneous)
  • Strategy and Management


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