The role of family in unfolding the process of external corporate venturing in small family businesses.

Abstract

The extant literature argues that small family firms with higher family ownership have a lower proclivity toward external corporate venturing (ECV) activities. We contend that this is not true for all small family firms. Some family firms with higher family ownership can have a higher proclivity toward ECV. Focusing on small family firms with 100% family ownership (highest ownership), we argue that there is heterogeneity in terms of the family’s goals (potential gains) and resources among small fam-ily firms that can impact these firms’ engagement in the ECV process. On this basis, we present a concep-tual model and some propositions that explain why some small family firms pursue ECV opportunities.