How do ventures become more innovative? The effect of external search and ambidextrous knowledge integration

Purpose New ventures search for external knowledge to break through the prevailing knowledge and resource constraints. The influence of search mechanisms can be assessed against the backdrop of internal factors such as the venture's knowledge integration (KI) capability. The purpose of this paper is to study the effects of knowledge search depth (KSD) and knowledge search breadth (KSB) on innovation outcomes and asks to what extent such effects are mediated by levels of KI. Design/methodology/approach The authors distinguish between the current depth and width of the firm's knowledge base as to detect their possible moderating effects. The authors test the model using data collected from 167 Chinese start-ups. Findings The results show that KSB has a positive effect on KI and innovation performance, but KSD has an inverted U-shaped effect on KI and innovation performance. KI plays a mediating role between external knowledge search and innovation performance, while the breadth of the venture's knowledge base positively moderates the relationship between explorative KI and innovation performance, and the depth of knowledge base positively moderates the relationship between exploitive KI and innovation performance. Originality/value These results differ from earlier research focusing on mature enterprises.