First-mover advantages and intentional knowledge spillover effects on cybersecurity start-ups’ financial and innovation performance: incentive for revealing innovations in high-tech emerging industry

ABSTRACT

Cybersecurity industry, an emerging industry, has the distinctive characteristic of low appropriation ecosystem, as exemplified by free disclosure of white papers and open-source software. Focusing on the above characteristics, this study empirically analyses the cybersecurity start-ups’ financial and innovation performance in terms of first-mover advantages. Moreover, this study examines whether the start-ups’ intentional knowledge spillover activities moderate the subsequent performance. A sample of 327 start-ups related to cybersecurity technology was analysed, and the major results are as follows. While first-mover advantages are positively valid in financial performance, the start-ups’ early entry and innovation performance have an inverted U-shaped relationship. Moreover, the start-ups’ intentional knowledge spillover activities positively moderate the interaction between early entry and innovation performance. The results confirm that latecomers are also capable of high innovation performance in the cybersecurity industry, and it suggests that start-ups in the high-tech emerging industry need to convert the innovation paradigm from closed to open, aiming for shared growth of the overall industry scale and sustainable innovation.

KEYWORDS:

• Knowledge spillover
• first-mover advantages
• emerging industry
• cybersecurity start-ups
• innovation performance

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

1 Interaction between entry timing and innovation performance is a linear mechanism, not quadratic latent (Folta & O’Brien, 2004; Zhou & Wu, 2010), and a moderating impact variable of ‘Entry timing × Intentional knowledge spillover’ makes additive turning point shift on the linear mechanism of inverted U-shape (Haans et al., 2016).

Additional information

Notes on contributors

Dongwoo Lee

Dongwoo Lee is a PhD candidate in Technology, Management, Economics and Policy program, College of Engineering, Seoul National University. His research interests include technology transfer, SME innovation and knowledge management. He worked as a researcher at Science & Technology Policy Institute (STEPI). He has published several papers in International Journal of Technology, Policy and Management.

Yeonbae Kim

Yeonbae Kim, PhD in Engineering, is a professor in Technology, Management, Economics and Policy program & Graduate School of Engineering, Seoul National University. His research interests focus on intellectual property rights, technology transfer and commercialisation of technology. He has published several papers in Technovation, Journal of Small Business Management, R&D Management, Technology in Society, Renewable Energy, Science and Engineering Ethics, Environmental and Resource Economics, etc.