Compared with new ventures, established firms are difficult to flexibly respond to external environment changes because of their low efficiency in internal innovation activities. With increasing environment uncertainty, the trajectory of technology innovation becomes more and more unpredictable, and corporate venture capital（CVC）has become an important strategic method to incumbents for acquiring innovation resources from new ventures, and rises rapidly in practice. CVC could help incumbents to configure technology real options more effectively through investing a variety of new ventures, thereby enabling them to explore innovation opportunities in much more wide areas. Researches have provided considerable empirical evidence in the positive effect of CVC investment on incumbents’ innovation performance, but there still lacks direct evidence in the effects of CVC real option attributes on investor firms’ technological innovation performance. Therefore, we carry out an empirical research based on real options and organizational learning theories to answer following questions: first, could CVC investment improve investor firms’ technological innovation performance under higher uncertain environment? second, could internal innovation input enhance the positive effect of CVC investment on investor firms’ technological innovation performance? We employ the data of 376 listed firms from Shanghai and Shenzhen stock markets which have made CVC investment from 2001 to 2014, and analyze them with negative binomial regressions. The results indicate that:（1）there is a significant inverted U-shaped relationship between the number of CVC investment and investor firms’ technological innovation performance;（2）environment uncertainty has a significant positive moderating effect on the relationship between CVC investment and investor firms’ technological innovation performance;（3）the internal technology innovation input also has a significant positive moderating effect on the relationship between CVC investment and investor firms’ technological innovation performance. Our further analysis of moderating effect shows that, under high environment uncertainty or high level of internal innovation input, the apex of inverted U-shaped curve shifts to right, and the curve becomes steeper, confirming our hypotheses. We also have ran following robust checks. First, we replace the number of three types of patents with the number of invention patents as the dependent variable, as invention is usually more innovative compared with utility model and appearance design. The results are similar to former regressions. Second, considering that the time lag effect of CVC investment on technology innovation might vary with temporal changes, we replace the dependent variable with 2, 3, and 4 years lag patent numbers respectively, and get similar results too. This paper might contribute to the fields of CVC research and real option theory in following issues: firstly, it provides direct empirical evidence for the relationship between CVC’s real option attributes and investor firms’ technological innovation performance. In terms of the relationship between CVC’s real option attributes and investor firms’ innovation performance, there are many theoretical analyses but little direct empirical evidence. This paper provides direct empirical evidence with the data drawn from China’s listed companies. Secondly, it reveals the complementation effect between external innovation resources acquired from CVC investment and firms’ internal resources input in technological innovation. This finding also indicates that within low innovation input group, the increase in the number of CVC investment actually suppresses investor firms’ innovation performance. It shows that the value of real options depends on not only external factors such as environment uncertainty and investment irreversibility, but also the support from firm internal related resources. However, our research also has limitations: first, we use technology human resources to measure technological innovation input because many listed firms do not disclose R&D expenditures. Second, the value of technological innovation depends on not only its technological advancement, but also the extent to which a firm could successfully commercialize it. Future researches may attain new knowledge through using new commercialized products/services to measure technological innovation performance.
Corporate Venture Capital and Technological Innovation Performance from a Real Option Perspective
Foreign Economics & Management Vol. 39, Issue 12, pp. 38 - 52 (2017) DOI:10.16538/j.cnki.fem.2017.12.003
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Cite this article
Qiao Mingzhe, Zhang Yuli, Zhang Weiqian, et al. Corporate Venture Capital and Technological Innovation Performance from a Real Option Perspective[J]. Foreign Economics & Management, 2017, 39(12): 38–52.
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