Balancing Intrapreneurial Innovation Vs. Entrepreneurial Spinoffs During Periods of Technological Ferment

Abstract

The period immediately after a technological discontinuity allows an innovative startup to exploit a period of ferment and great uncertainty. Meanwhile, mature innovators must develop intrapreneurial capabilities to compete with these new entrants. Using multiple data sources, we examine the innovation capabilities of Linkabit, a firm that exploited the opportunities related to digital communications, and how those capabilities were transferred to informal spinoffs which formed at twice the rate of Fairchild Semiconductor. We discuss the contingent value of innovation capabilities for early stages in a technological regime, as well as the conflicting goals of intrapreneurial development vs. restraining entrepreneurial exodus.