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| Limited Partner, Competitor Indirect Ties and Entrepreneurial Innovation |
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Abstract This study investigates the impact of competitor indirect ties through limited partner (LP) on innovation at entrepreneurial firms from the theoretical perspective of competitive information leakage.By collecting samples of Around venture capital (VC) financing firms in the electronic and optoelectronic equipment industry with the PEdata Database, and by using the negative binomial model, it is found that indirect ties to competitors through LP impede innovation, and that this effect is moderated reversely by several factors including indirect ties to competitors through VC, relative amount of LP commitment in VC funds, and VC cooperation.This study expands the hypothesis of competitive information leakage to LP level, and reminds entrepreneurial firms that when seeking VC financing, it is necessary to pay caution to the likely negative effect of both the obvious competitor indirect ties through VC and the hidden competitor indirect ties through LP.
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