This study analyzes the comparative effects of three distinct innovation strategies – exploration, exploitation, and ambidexterity – on both financial performance and firm growth among student-led ventures. A core focus is the moderating influence of cofounding team size on these strategy-performance relationships.
The research draws on data from 19,978 active student entrepreneurs surveyed in the 2018 Global University Entrepreneurial Spirit Students' Survey (GUESSS), covering 54 countries and more than 3,000 universities. Structural equation modelling (SEM) is used to test the hypothesised direct and moderating effects.
Exploration and exploitation each exert positive effects on financial performance and firm growth. Conversely, ambidexterity shows a small but significant negative association with financial performance and no effect on growth. Cofounding team size strengthens the positive financial returns of exploration and exploitation but weakens the financial impact of ambidexterity.
Student entrepreneurs operating with limited resources may benefit more from adopting focused strategies – either exploration or exploitation – rather than attempting to pursue both simultaneously. Team size should be considered a strategic asset that facilitates focused orientations but complicates ambidextrous efforts.
This study extends innovation-strategy research to the largely overlooked context of student-led ventures. By integrating a multidimensional view of performance with a team-level contingency, it shows that the benefits of innovation strategies depend on venture resource constraints and team structures. The findings challenge the assumption that ambidexterity is universally advantageous.
