Entrepreneurial Orientation and Firm Performance in New Ventures and Established Firms

Lots of studies suggest a positive relationship between entrepreneurial orientation (EO) and firm performance; however, the empirical findings are inconclusive. There are two explanations for the contradictory results: the performance implication of EO is context-specific and the relationship between EO and performance may be curvilinear. Consulted on the perspective of the liability of newness and taken together these explanations, this paper probes into the difference in the EO-performance linkage between new ventures and established firms. We find that the relationship between EO and performance is inverse U-shaped in new ventures but positive in established firms. Finally, we discuss our contributions, implications, and possible future extensions.