Prior tacit knowledge and first-year sales: learning from technology entrepreneurs

Purpose - This paper aims to explore differences in tacit knowledge at opportunity recognition reported by founders of new technology ventures. The paper seeks to shed light on the types of tacit knowledge related to achieving sales within the first year of new technology ventures. Design/methodology/approach - A survey was administered to 145 technology venture founders during structured interviews across 13 university-affiliated technology incubators. To investigate tacit knowledge a framework was used comprised of ways to serve markets, customer problems, markets, and technology. The results were analyzed using t-tests and logistic regression while controlling for founder's years of work experience. A configuration analysis is presented revealing the patterns of knowledge related to sales in the first year of new ventures. Findings - The study provides an understanding of how types of tacit knowledge relate to early sales outcomes in the high technology context. Prior hands-on experiences with development of products or services as well as prior experiences within markets were found vital to achieving first-year sales for newly created innovations. On the other hand, tacit knowledge of customer problems and technology is, surprisingly, of less importance. Research limitations/implications - The findings provide insights as to the particular hands on experiences important in achieving desirable venture outcomes. By identifying and developing tacit knowledge in particular areas (prior hands-on development experience and prior experience within markets) future entrepreneurs may develop an early sales advantage. The results demonstrate how configurations of tacit knowledge link to desired outcomes while highlighting the importance of certain knowledge at the opportunity recognition stage of new product development. Practical implications - Generation of early sales for new technology ventures is a momentous concern for enterprise development. The ability to identify specific types of knowledge that link to initial sales enables educators and entrepreneurs alike. Originality/value - The paper develops further a theoretical conceptualization of types of knowledge related to recognizing opportunities. The study contributes to the literature by assessing how patterns of tacit knowledge at opportunity recognition relate to achieving early sales in the context of technology entrepreneurship.