Unraveling legitimation strategies of Chinese Internet start-ups

Abstract

Purpose

The purpose of this paper is to explore the legitimacy needs and legitimation strategies of Internet start-ups in the context of industry dynamism.

Design/methodology/approach

The purpose of this paper is to explore the legitimacy needs and legitimation strategies of Internet start-ups in the context of industry dynamism.

Findings

The authors found that Internet start-ups are in great need of acquiring market and relational legitimacy at their nascent stages. Conformance to the environment is widely adopted by them as a legitimacy-enhancing strategy. There is an inverted “U” relationship between the maturity of the industry and the proactivity of any legitimation strategy in the sector. In the face of high- and low-level industry maturity, start-ups tend to employ prudent strategies to build up legitimacy. While in medium-mature industries, ventures are more likely to adopt proactive and aggressive strategies.

Research limitations/implications

Due to the very nature of case methodology, this study is based on a small number of observations and it is set in the context of the Internet industry. The generalizability of its findings needs to be reinforced by further concrete studies.

Practical implications

This paper suggests that industry dynamism should be taken into account carefully when implementing a choice of legitimation strategies.

Originality/value

This study makes an attempt to further our understanding of how industry dynamism influences firms’ choices of legitimation strategies.

Citation

Su, X., Peng, H., Zhang, S. and Rong, Y. (2015), "Unraveling legitimation strategies of Chinese Internet start-ups", Chinese Management Studies, Vol. 9 No. 2, pp. 239-258. https://doi.org/10.1108/CMS-12-2014-0235