Lange (2009) Flashcards
1
Q
The paradox between start-ups and business units launched by existing firms that diversify from outside the new industry.
A
paradoxically, corporate parents promote the survival of other organizations in this type of young industry while hindering the survival of their own offspring.
Furthermore, the age of corporate parents and their size have a negative effect on the failure rates of their corporate children because of parental resistance and bureaucratic delay
However, the hazards imposed by older corporate parents are less detrimental to larger children. Spin-off should therefore have a certain size and corporates should not be too old.