The Impact of Corporate Venture Capital on the Branding Efforts of New Technology Firms

This article analyzes the impact of corporate venture capital (CVC) funding on branding efforts in new firms. Building on resource dependence theory, the authors propose that CVC funding will induce new technology firms to be more dependent on corporate partner brands, thereby attenuating subsequent, independent branding efforts—as indicated by trademark output— in new firms. The data consists of 394 high technology firms founded in the United States in 2004 and tracked over a five-year period. Using a stochastic frontier method, the authors show that new firms with a high degree of intangible resource inputs are less dependent on the corporate partner’s brands than those with a lower degree of intangible inputs. Implications for both research and practice related to the broader relationship among entrepreneurial finance, entrepreneurial marketing and intellectual property strategy are discussed.