Early mover (dis)advantages and knowledge spillover effects on blockchain startups' funding and innovation performance

This study investigates whether early mover (dis)advantages are valid in the blockchain industry. Specifically, it examines how the entry timing of a startup in the blockchain industry affects its funding attraction from venture capitals and innovation performance. Moreover, this study examines whether the startup's knowledge spillover activities moderate the relationship between its entry timing and subsequent performance. An empirical analysis is conducted on 255 startups in the blockchain industry founded between 2007 and 2016. The results show that while early mover advantages exist in terms of funding attraction from venture capitals, the entry timing and innovation performance have an inverted U-shaped relationship, as expected. Knowledge spillover activities of blockchain startups positively moderate the relationship between the entry timing and the venture capital attraction. Managerial and theoretical implications for the blockchain industry are discussed.