This study aims to explore how variations in goal congruity and lifecycle stages influence start-ups’ approaches to coopetition and how these factors shape their strategies for competing and cooperating with rivals.
Using industrial network and interaction approach, this paper analysed interview data from 32 key informants from technology-based start-ups, and identified four distinct approaches to coopetition.
The findings reveal that while shared goals facilitate start-ups’ openness to coopete and share knowledge, this potential develops into a relational approach as coopetition is sustained over time. Conversely, without shared goals, start-ups either adopt a transactional approach to coopetition or choose not to coopete at all. These approaches also depend on the venture’s stage of life – growth/maturity versus early stage – with growing, mature start-ups associated with a relational approach or no coopetition, while early-stage start-ups are linked to potential coopetition and knowledge exchange over the long term or a transactional approach.
This paper advances the business network literature by developing a model that explains how shared goals and a venture’s lifecycle influence approaches to coopetition in new ventures.
1. Introduction
Research has long recognised that the success of new ventures requires an array of resources (Van de Ven et al., 1999). Given a new venture’s liability of newness and smallness (Guerrazzi et al., 2022; Gimenez-Fernandez et al., 2020; Aldrich and Auster, 1986; Stinchcombe, 1965), networks play an essential role by facilitating access to external actors and resources (Ciabuschi et al., 2012; Hoang and Antoncic, 2003; Huang and Knight, 2017; La Rocca et al., 2013; Newbert et al., 2013). By engaging in coopetition, specifically cooperating with competitors to create value (Meena et al., 2023), start-ups can share resources, knowledge and networks with competitors, allowing them to overcome the lack of resources.
In addition, organisational lifecycle theorists indicate that as a start-up progresses through its lifecycle stages, each stage presents a distinctive strategic context that impacts the start-up’s external resource needs and challenges in acquiring resources (Hite and Hesterly, 2001; Marcon and Ribeiro, 2021; Walrave et al., 2018). Lifecycle helps to understand the different stages of a start-up’s development, from inception to growth and potential maturity or exit, and the change in the strategies used based on the changes in needs over time (Paschen, 2017). By examining these stages, we as researchers identify the unique differences in using coopetition strategies start-ups face. It provides a contextual understanding of our research. In line with this notion, empirical evidence indicates that as a start-up develops, the significance of social and reputational networking tends to diminish. At the same time, the prominence of coopetition grows over time (Lechner et al., 2006). However, in start-ups, extant business network literature on coopetition – the relationships between two or more actors that simultaneously cooperate and compete (Dowling et al., 1996) – is sparse (McGrath et al., 2019b). Research that does exist explores patterns of business-to-business (B2B) interactions to determine the extent of coopetition in business relationships and networks among entrepreneurial ventures but does not consider the venture’s stage of life (McGrath et al., 2019b).
While wider B2B research on coopetition in start-ups is gaining traction (Blanka and Traunmüller, 2020; Guo et al., 2023; Jost, 2022; Klammer et al., 2023; Yang and Zhang, 2022), to the best of the authors’ knowledge, we are not aware of any new venture business network research that examines approaches to coopetition by stage of the lifecycle. Hence, our knowledge of the nature of competition is limited in the discrete stages of a new venture’s lifecycle, and we do not know when and why founders of start-ups and their rivals exchange knowledge and other resources across different stages of the life of a start-up. This is surprising, given that wider industrial network research acknowledges that business relationship development in start-ups is also a source of value to the start-up and its networks (McGrath et al., 2018).
A second gap relates to the congruity of goals between coopetitors, which are underlying motives for intentional behaviour (Mintzberg, 1983). Goal congruence is defined as the extent to which the coopetitors perceive that they can achieve compatible or common objectives (Jap, 1999). With congruent goals, organisations are intrinsically motivated to adopt cooperative behaviours (Yan and Dooley, 2013); when companies engage in coopetition, their interests can be aligned by establishing congruent goals for shared tasks (Yan and Dooley, 2013). While firms engaged in coopetition share similar goals (Peng et al., 2012), with common goals as a motive for cooperative ventures (Raza-Ullah et al., 2014), conflicting goals are also inherent in coopetition (Mattsson and Tidström, 2015), which may give rise to tensions (Efrat et al., 2022). Yet our understanding of the influence of incongruent goals of actors in coopetition (Dorn et al., 2016) is limited, particularly in the start-up context. Thus, the objective of this research is to address these gaps by exploring the research question:
How do variations in goal congruity and the stage of the start-up life influence start-ups’ approaches to coopetition?
Based on a qualitative study of technology-based start-ups comprising enterprises ten years of age or less (Semrau and Sigmund, 2012), we advance extant business network literature (McGrath et al., 2019a, 2018; O’Toole and McGrath, 2018), and specifically, business network research on coopetition (McGrath et al., 2019b) by showing that while shared goals of start-ups facilitate their openness to potential coopetition and knowledge sharing, this potential develops into a relational approach as coopetition and knowledge and resource sharing are sustained over time. Conversely, in the absence of shared goals, start-ups either adopt a transactional approach to coopetition or choose not to share and exchange knowledge and resources with competitors.
We demonstrate that these approaches also depend on the venture’s stage of life – growth/maturity versus early stage – with growing, mature start-ups associated with a relational approach or no coopetition, while early-stage start-ups are linked to potential coopetition and knowledge exchange over the long term or a transactional approach. Thus, we advance our understanding of how and when shared goals and a venture’s lifecycle influence approaches to coopetition in start-ups and distil these factors into a model of coopetition approaches. The model is theoretically significant due to our limited understanding of the joint influence of shared goals and a venture’s lifecycle on coopetition in new ventures, with much of the extant business network literature on start-ups at a nascent theoretical understanding (O’Toole and McGrath, 2018).
This paper is structured as follows: first, we will overview the theoretical background and review the literature on coopetition in start-ups, including research on shared goals and stages of lifecycle. Subsequently, we outline our research methodology and present the study’s findings. Following this, we discuss the findings and examine theoretical and practical implications. Finally, we conclude by addressing the study’s limitations and suggesting future directions.
2. Theoretical background
This study is informed by the industrial network and interaction approach, which scholars have extensively discussed as businesses are heterogeneous and can benefit from interacting with other businesses and exchanging resources (Dubois and Håkansson, 2002; Gadde and Håkansson, 2011). Originating from the industrial marketing and purchasing (IMP) group, this approach emphasises the significance of nurturing relationships within the business context to make sense of inter-organisational relationships, including cooperation and competition (Håkansson et al., 2010). This approach emphasises the significance of relationships, interactions and managing supply networks in industrial marketing (Håkansson et al., 2010). Networking and interactions within this framework are geared towards cultivating connections that can lead to new opportunities, such as partnerships, and aligning well with coopetition. Networking is inherently beneficial, fostering the exchange of information and knowledge, which often catalyses innovation activities (Breschi and Lissoni, 2001). A fundamental aspect of this networking process is establishing trust, which is crucial in building robust business relationships (Holm et al., 1999). This becomes especially pertinent in coopetition among start-ups, where organisations, despite their competitive market positions, choose to engage in collaboration (Berbegal-Mirabent et al., 2021), which can be a beneficial strategy for start-ups (Crick, 2020). Still, they have limited resources which cannot be wasted.
Under the industrial network approach, businesses are part of multiple connections facilitating resource access (Najafi-Tavani et al., 2018). This presents a clear link to the resource-based view (RBV), which sees businesses as bundles of resources (Chahal et al., 2020; Pereira and Bamel, 2021) that can create a competitive advantage (Barney, 1991), while the KBV (which is a subset of the RBV) sees knowledge as the most relevant resource for generating competitive advantage (Alvarez and Busenitz, 2001). Knowledge, innovation and competitive advantages are essential for creating goods and services (López-Cabarcos et al., 2019; Gassmann and Keupp, 2007; Nonaka, 2009). Alvarez and Busenitz (2001) considered the need for advice directly related to the knowledge gap, which is critical for start-ups in the initial and later development stages (Köseoğlu et al., 2019; Kuhn and Galloway, 2015). Businesses, including start-ups (de Zubielqui and Jones, 2020; Najafi-Tavani et al., 2018), use their networks and other relationships to access the required knowledge.
The RBV has been used previously to understand the antecedents of coopetition (Czakon et al., 2020), the coopetition behaviours (Crick, 2021; Crick et al., 2023) and uses a relational view at the firm level (Köseoğlu et al., 2019). The differences in firms’ performances are often associated with access to resources that are rare, inimitable, non-substitutable and valuable (Barney, 1991), and coopetition may facilitate access to the required resources to outperform other businesses (Meena et al., 2023).
The RBV and KBV have been used to explain resource access and why enterprises enter inter-organisational links (Grant and Baden‐Fuller, 2004). Start-ups, in particular, are required to access external resources due to the liability of newness and smallness (Das and Teng, 2000; Wiklund et al., 2010), underscoring the importance of network relationships (Semrau and Sigmund, 2012).
3. Literature review
3.1 Start-ups coopetition
The term coopetition was introduced considering the interfirm relational perspective by Dowling et al. (1996). Bengtsson and Kock (2014, p. 180) define coopetition as “a paradoxical relationship between two or more actors, regardless of whether they are involved in horizontal or vertical relationships, simultaneously in cooperative and competitive interactions”. Coopetition combines the benefits of cooperation and competition, leading to more substantial outcomes than purely collaborative agreements (Czakon et al., 2014; Ritala, 2009).
Firms adopt coopetition strategies to address technological challenges, explore new business models and tap into market opportunities (Bacon et al., 2020; Czakon et al., 2014; Gnyawali and Park, 2011). Coopetition is recognised for enhancing performance (Crick, 2019), improving market intelligence, and creating value through cooperative interactions while competing for a share of that value (Efrat et al., 2022). It provides partners with an advantage over other competitors and offers better solutions to customers, ultimately improving the market as a whole (Liu et al., 2023; Monticelli et al., 2022). It allows start-ups to build and legitimise their market category by developing technological capabilities (Klimas, 2016) and enhancing performance and survival rates, particularly in small and young organisations (Lechner et al., 2006).
Start-ups participate in coopetition to leverage strengths, overcome limitations and strategically position themselves (Hora et al., 2018; Soppe et al., 2014). This strategic approach becomes crucial for start-ups, as they bring innovation and agility (Hora et al., 2018), while bigger organisations can bring resources. McGrath et al. (2019b) found that entrepreneurs respond to the environment by interacting in a coopetitive manner and forming norms of interaction. Bengtsson and Kock (2014) highlight that managing coopetition with larger firms may help to create and sustain entrepreneurial opportunities. Coopetition strategies have also increased in start-ups due to crises (such as COVID-19) (Crick et al., 2023).
Furthermore, coopetition can achieve cost reductions and risk mitigation, allowing economies of scale that reduce production costs and improve research and development benefits (Akpinar and Vincze, 2016). Coopetition can generate synergies, foster innovation, develop new products or innovative solutions and influence the degree of novelty (Czakon et al., 2020; Ritala and Hurmelinna‐Laukkanen, 2013). Furthermore, companies can learn from each other’s strengths and weaknesses, thus increasing the level of knowledge, which is considered highly relevant to influencing performance (McGrath et al., 2019b).
Coopetition holds benefits and may bring disadvantages and risks (Bengtsson and Kock, 2000; Cygler and Sroka, 2017), particularly for start-ups. Relationships within a coopetitive environment can be complex and demanding, balancing trust while also introducing tensions (Tidström, 2014) among cooperating competitors, leading to conflicts, such as resource and idea sharing. Cygler and Sroka (2017) identifies several risks associated with coopetition in the high-tech sector, including low efficiency of activities and goals pursued. Ritala (2009) highlighted the need for factors that enable collective value creation and individual appropriation of innovations. Furthermore, many authors investigated how coopetition strategies are relevant for small businesses (Morris et al., 2007).
The extant literature highlights the paradoxical relationship between cooperation and competition in business networks (see, e.g. Ricciardi et al., 2022). While cooperation and competition are necessary for business relationships, they are often viewed as conflicting forces. This paradoxical relationship can impact the performance of business networks, as it requires firms to balance what they do or do not share with the partner firms (Efrat et al., 2022). This balance is necessary for firms to maintain their competitive advantage. The more a firm shares, the less its competitive advantage, and the more it upgrades resources, the more it risks strengthening the capabilities and capacity of its coopetitive partners (Monticelli et al., 2022). The paradox between cooperation and coopetition can have positive and negative effects on the performance of business networks, requiring firms to navigate the complexities of balancing cooperation and competition in their relationships with other organisations (Ricciardi et al., 2022).
3.2 Start-ups coopetition and shared goals
Every business has goals and objectives, which can be described as long-term targets; they help organisations achieve their purpose (Singh and Singh, 2021). Many authors have recognised shared goals as part of the relational mechanisms (Dhanaraj et al., 2004). Li et al. (2010, p. 352) defined shared goals as “a bilateral understanding, approach, and vision for achieving tasks and outcomes…”. This shared understanding contributes to partners’ recognition that cooperation can enhance their individual and collective competitive positions (Li et al., 2010). With a shared vision, partners are likelier to engage in collaborative problem-solving processes and exchange resources and knowledge (Inkpen, 2008). Businesses with common goals and objectives (a co-vision) would collaborate to create new products or services (Liu et al., 2023; Liu and Rong, 2015).
Furthermore, Goswami and Agrawal (2020) found that shared goals impact knowledge sharing and creation, an important part of the coopetition process that influences business performance. Some authors pointed out the importance of alignment of actors’ goals and expectations for successful coopetition at the network level (Dorn et al., 2016), while others highlighted the importance of sharing goals and clear expectations for cooperation between start-ups and other organisations (Heratri and Klang, 2019; Kupp et al., 2017). Having a partner who shares goals and values can facilitate the process (Heratri and Klang, 2019), and evidence from the financial sector shows that shared goals and objectives are key success factors for collaborating with start-ups (Denysiuk, 2021). A mutual understanding among multiple actor-firms on achieving these outcomes facilitates support for their realisation (Liu et al., 2023). These shared goals are embedded in team members and can significantly drive long-term performance (Chen et al., 2022; Gattrubger and Wiener, 2020; Mathias et al., 2018).
Shared goals and coopetition are crucial elements in the success of start-ups, particularly those in emerging technology sectors (Gattrubger and Wiener, 2020). Knowledge sharing is the intensity of exchanging valuable knowledge between partners in a coopetitive partnership, highlighting the significance of sharing knowledge and leveraging it for collaborative efforts (Ho et al., 2020). Knowledge-sharing mechanisms are crucial for start-ups to access resources, facilitate innovation and support sustainable growth. However, challenges arise, such as protecting proprietary knowledge (Le Roy et al., 2025), while shared goals and trust significantly enhance knowledge exchange among start-ups (de Andrade and Pinheiro, 2023). In addition, intra-firm coopetition is closely linked to formal and informal knowledge-sharing mechanisms (Nguyen, 2020). The dynamics of coopetition require continuous adaptation and strategic management to ensure that start-ups can leverage shared knowledge without compromising their competitive advantage (Sindakis et al., 2020). Furthermore, information asymmetries can be reduced when technology-enabled knowledge management platforms that encourage knowledge-sharing rather than hoarding are used (Randolph et al., 2020).
The relationship between shared goals and coopetition is complex. Shared goals and organisational culture can encourage innovation and new ideas (Chen et al., 2022). However, there is also the risk that having similar interests and backgrounds can lead to “groupthink”, which can stifle disruptive ideas, which are key to innovative thinking. Thus, coopetition with partners with some differences would potentially result in more innovative thinking and outcomes rather than collaboration with very similar organisations (Liu et al., 2023).
3.3 Stages of start-ups’ lifecycle: networks and coopetition
Several models have outlined the sequential development of start-ups, with many models adhering to the traditional lifecycle model of organisational growth, where firms progress through sequential stages (Hite and Hesterly, 2001; Huang and Knight, 2017; Kazanjian and Drazin, 1989; Picken, 2017; Sapienza and Amason, 1993). Drawing on this work (Kazanjian and Drazin, 1989; Sapienza and Amason, 1993), Huang and Knight (2017) characterised growth as the evolution of a venture through an early stage of idea exploration, identifying an initial opportunity and strategy or model to exploit it; an intermediate phase of idea refinement and implementation; and an advanced stage of maturity, in which the new venture expands operations and scales the business.
Acknowledging that the boundaries between stages may overlap, the lifecycle stages are nonetheless helpful in comprehending the utility of different resources and networks as start-ups develop, with the premise that each stage influences the venture’s external resource requirements (Hite and Hesterly, 2001). Extant research reveals that the network ties of an emerging firm evolve in response to the evolving resource needs confronted by the new firm (Hite and Hesterly, 2001; Huang and Knight, 2017; Semrau and Sigmund, 2012), with Lechner et al. (2006) reporting that the significance of coopetition networks increase in later stage start-ups.
However, much of the extant business network literature on start-ups is at a nascent theoretical understanding, particularly research on business relationship development capability in start-ups (McGrath et al., 2019a, 2018; O’Toole and McGrath, 2018). The limited empirical evidence, based on one or two longitudinal case studies (McGrath et al., 2019a; O’Toole and McGrath, 2018) indicates that relationships and networks are vital for a new venture to gain, adapt and jointly incorporate external resources needed for navigating selection pressures and fostering long-term business growth over time (Lechner et al., 2006). Network capability is integral to start-ups accessing essential external resources by interacting within their business networks (McGrath et al., 2019a, 2018; O’Toole and McGrath, 2018).
In a related stream of emerging business network literature on coopetition in entrepreneurial ventures, McGrath et al. (2019b) examined patterns of B2B interactions in the micro-brewing sector in one US state. Findings indicate that coopetition is a core feature of collaborative dynamics in new ventures; coopetitive interactions are influenced by an entrepreneurial coopetitive mindset and the relational environmental context (McGrath et al., 2019b). Results also indicate that a recurrent action-interaction cycle among actors generates norms and relational structures that, when experienced, change the entrepreneur’s mindset from independence to interdependence.
Thus, although increasing business network literature on coopetition in start-ups is also limited, and to the best of the authors’ knowledge, no existing study investigates coopetition among start-ups based on their stage of life. There is a lack of insight into the characteristics of coopetition at distinct stages of a new venture’s lifecycle, which are the factors that influence knowledge and resource exchange between founders of new ventures and their competitors across various stages of a new venture life. The next section presents the research method to address this study’s objective.
4. Methodology
Given the nascent theoretical understanding of the nature of coopetition in start-ups, a qualitative research approach is appropriate to generate an in-depth understanding of the research objectives (Bouncken et al., 2015). Qualitative research methods apply to address “how” and “why” questions, including research questions that seek to refine existing theories by elaborating their boundary conditions and introducing nuanced complexities through observed contextual variations (Lindgreen et al., 2021). As this study’s research question centres on how variations in goal congruity and the start-ups’ stage of life influence coopetition and knowledge exchange, and hence a contextual perspective on start-ups’ approaches to coopetition, a qualitative approach to the research was adopted. Contemporary industrial marketing and entrepreneurship research also emphasise the necessity of qualitative research to comprehend the complex and context-specific aspects of relationships and networks (McGrath et al., 2019b; Van Burg et al., 2022; Magnani and Gioia, 2023).
4.1 Sampling – purposive sampling
The research sampling process focused on identifying Australian support organisations, such as incubators, accelerators and coworking spaces and potential technology-intensive start-ups associated with them (Charmaz, 2014) using publicly available data through websites of start-up programs. Subsequently, searches on associated websites, including alumni subpages, news sections and blog segments, were conducted to locate start-ups affiliated with these support organisations. Four criteria typically utilised in research on entrepreneurship (Vanderwerf and Brush, 1990) were used to select the start-ups for this study, ensuring the purposive nature of the selection process (Miles and Huberman, 1994). First, we restrict the sample to the enterprise age. Consistent with prior work on start-ups (Lechner et al., 2006), firms are included only if they were established for ten years or less. While some studies exclude firms less than one-year-old (Semrau and Sigmund, 2012), we include these start-ups, given our interest in the influence of the early stage of the venture lifecycle. Second, start-ups should not be subsidiaries or affiliated companies (Semrau and Sigmund, 2012). Thus, our sample includes only independently owned and operated firms. Third, given the coopetition-related objective of the study, start-ups must either be engaged in or hold a perspective on coopetition. Fourth, we limit the sample to technology-intensive start-ups to ensure comparability and control for potential cross-industry differences (Ripollés and Blesa, 2018; Semrau and Sigmund, 2012). With clear criteria, researchers contacted these start-ups, aiming for diversity in size, age, location and sector, expecting to observe business model changes due to the crisis. As differences in business model changes became apparent, the team employed theoretical sampling to refine their categories and theories further (Corbin and Strauss, 2015). The sampling and interviewing process was iterative, with ongoing data analysis guiding the selection of additional start-ups until theoretical saturation was reached (Eisenhardt, 1989), where no new significant insights emerged (Corbin and Strauss, 2015). Table 1 presents details of the start-ups. Key informants from start-ups – discussed below – were then contacted electronically.
4.2 Data collection
The main source of data was semi-structured interviews with key informants (Mathias and Williams, 2018), who were the start-up’s founder, Chief Executive Officer (CEO) or Managing Director (MD). These informants had decision-making authority over the new venture, including its coopetitive interactions. This approach is consistent with Kumar et al. (1993), who suggest that, in small firm contexts, using a single key informant can be suitable, as it effectively addresses questions specific to the study. It also aligns with the concept of “elite” informants (Aguinis and Solarino, 2019). Ethics approval to conduct interviews was sought and obtained on 11 May 2020, under the number H-2020–071.
Semi-structured interviews have the advantage of providing rich, nuanced data from knowledgeable participants (Lindgreen et al., 2021) and thus were used to systematically explore a variety of areas and provide flexibility for probing, clarification and addressing emerging issues (McIntosh and Morse, 2015). Interviewees were prompted to provide descriptions and elaborations, focusing on obtaining specific examples or illustrations to ground their responses. This is consistent with prior qualitative research practices (Brown et al., 2009) that seek to secure genuine responses, avoiding participants’ potential inclination to provide replies they believe are expected (Hunt and Boxall, 1998).
An interview schedule was developed based on a review of related industrial networking coopetition literature. It comprised two parts: the first part contained questions related to the founder, CEO or MD’s work history and experience and the start-up’s age, employment size and history, which aided in contextualising responses. The second part focussed on questions that were formulated to obtain responses from the informants regarding our primary variables: qualitative descriptions of the start-ups’ coopetitive interactions (i.e. history, experiences, knowledge and other resource exchanges within these interactions) and their evolution; goals, values and stage of the start-up.
Semi-structured interviews were conducted using Zoom Video Conferencing software with 32 key informants and ranged from 38 to 90 min.
In accordance with qualitative research practice, the interview process concluded upon reaching theoretical saturation. Analysis of data gathered from 29 interviews revealed no new factors or themes, corroborating theoretical saturation (Glaser, 1967). As a confirmatory measure, three additional interviews were conducted (a total of 32), with findings from these interviews reinforcing theoretical saturation.
Archival documents (e.g. company websites, documents, reports, presentations and social media feeds and business press articles involving the start-ups) were also collected, which allowed triangulation of data and reduced retrospective biases (Eisenhardt and Graebner, 2007) and hence enhanced the robustness of our findings.
4.3 Data analyses
Digitally recorded interviews were transcribed, and participants’ names were pseudonymised to ensure anonymity. Demographic information about participants was extracted from the transcribed interviews and organised in an Excel spreadsheet.
A structured, multi-step approach to data analysis was followed (Magnani and Gioia, 2023) as detailed below.
The initial phase of the analysis commenced with two authors thoroughly reviewing and revisiting each interview transcript to comprehensively understand each transcript independently. Each transcript was then categorised into first-order codes independently by the two authors. The process of generating first-order codes comprised organising participants’ statements (i.e. quotes and common expressions) based on common themes (see Figure 1). To illustrate this process of the derivation of first-order codes, the first exemplary quotes in Figure 1 state:
We’re rivals, but we also share common ground. Building an ecosystem has the potential to benefit all participants. Startups in particular can benefit from its resources, support, and connections. An ecosystem provides the platform for startups with complementary technologies to collaborate on the joint development and commercialisation of new tech that better meets the needs of potential customer, which the ecosystem can provide access to. Interviewee #4.
The first-order codes – rivalry with shared goals, mutual benefits in ecosystem, resource sharing, complementary technologies, joint development, collaborative commercialisation and access to potential customers – focus on elements related to shared goals, cooperation, mutual benefits and collaboration that capture the essence of working together towards a common objective. Thus, these first-order codes represent specific elements of the second-order goal congruity theme, illustrating how competitors work together towards a common aim.
Thus, the second stage involved transitioning from first-order codes to more abstract second-order categories as we searched for patterns (themes) in coopetition interactions that occurred consistently within and across start-ups. Subsequently, these patterns were consolidated into aggregated dimensions across all interview data (see Figure 1) and reflect the four overarching approaches to coopetition and knowledge exchange among start-ups. Figure 1 provides examples of how the coding process evolved from first-order codes to aggregated themes (Magnani and Gioia, 2023).
Although initial insights and themes were derived inductively from the data, they were also shaped by extant research. Therefore, abductive logic (Langley, 1999) was adopted, which aligns with an intermediate stance between induction and deduction. This approach allowed for an ongoing refinement and development of our patterns (themes).
As an illustration, recurring terms and phrases in key informants’ verbatim expressions first indicated a transactional approach to coopetition and knowledge exchange and a relational approach. While the identification of the transactional approach was relatively straightforward, upon turning to the literature on resource exchange (Blau, 1964) in the new venture context (Huang and Knight, 2017), relational development capability processes (McGrath et al., 2018) and wider B2B research on network capability development (McGrath et al., 2019a; O’Toole and McGrath, 2018), the relational category was disaggregated into two: a relational approach to coopetition and knowledge exchange, and relational development that underpins potential coopetition and knowledge exchange over the longer-term, that provides insights into how coopetitive interactions change and evolve over time. In this round of analyses, differences according to the start-up stage also emerged across data, specifically, early stage and growth/maturity. We conceptualise early-stage start-ups as enterprises that are less than four years of age (Semrau and Sigmund, 2012) and have not received external funding (Gauger et al., 2021). Mature start-ups comprise new ventures between four and ten years of age (Semrau and Sigmund, 2012) and have received external funding (Gauger et al., 2021). Thus, we re-coded interviews according to the start-up stage, with transcripts of early-stage start-ups systematically interrogated alongside mature start-ups. Iterating between transcribed data (inductive logic) and literature on new venture lifecycle stages (Hite and Hesterly, 2001; Huang and Knight, 2017; Picken, 2017) and resource limitations of early-stage, small start-ups (Aldrich and Auster, 1986) (deductive logic) was also crucial to understanding how the early stage of start-up influences coopetition approaches, and the distinction of potential coopetition and knowledge exchange over the longer-term, from the relational approach. We also interrogated the data for differences by goals, specifically, goal congruity versus absence of goal alignment, which emerged as integral to explaining the approaches to coopetition among start-ups.
To consolidate the empirical findings, we integrated these themes into a model (Figure 2) to visually depict the interaction between shared goals and values – or absence thereof – and the start-up stage that influences the four approaches to coopetition, which we explicate below.
4.4 Trustworthiness
Two members of the authors’ team cross-coded the transcripts to ensure the consistency and reliability of the coding scheme used in the study, hence a valid and reliable interpretation of the data. The analyses obtained were then compared to enhance and integrate the themes. Minor discrepancies were addressed through discussion after a collective examination of the themes.
In the next section, we explicate four combinations of shared goals and values or the absence thereof, the start-up stage influencing coopetition for knowledge exchange and the dynamics characterising these coopetitive interactions.
5. Findings
The results show that while shared goals facilitate start-ups’ openness to potential coopetition and knowledge exchange over the long term, a relational approach to coopetition and knowledge exchange comprises shared goals, values and coopetition sustained over time. Conversely, in the absence of shared goals, start-ups either adopt a transactional approach to coopetition and knowledge exchange or choose not to engage in coopetition. Findings also indicate that the stage of the lifecycle of the start-up – early-stage versus growth/maturity – also influences coopetition and knowledge exchange, with mature start-ups associated with a relational approach or no coopetition, while early-stage start-ups are linked to a potential coopetition and knowledge exchange over the long term or a transactional approach. We explain these patterns below and distil them into a model of coopetition and knowledge exchange (Figure 2).
5.1 Shared goals and early-stage start-ups: potential coopetition and knowledge exchange over the longer term
Data analyses indicate that shared goals facilitate early-stage start-ups’ openness to potential coopetition and knowledge exchange over the long term, with discrete exchanges of knowledge and expertise in the interim as the basis for relational development that underpins long-term coopetition, as illustrated below.
According to Interviewee #3, founder of a start-up in the Australian ag-tech industry, while start-ups share a common goal of building successful ag-tech businesses, they are also competitors:
Startups share the same goal – we’re all trying to create successful ag-tech businesses. But we also all want to own the customer; be the customer’s trusted source of technology and advice. So, we’re competitors too. (Interviewee#3)
This shared goal provides a foundation for potential coopetition and knowledge exchange among start-ups in the ag-tech ecosystem:
We are a very open-facing organisation that is very collaborative that wants to create an ecosystem – collaboration and resource and knowledge sharing and exchange between ag-tech businesses to create better outcomes for customers. (Interviewee#23)
Thus, these early-stage start-ups recognise the long-term benefits of coopetition among actors in their ecosystem, acknowledging that the industry’s success is intertwined with the ecosystem’s collective efforts. However, analyses also indicate that the early stage of the start-up’s lifecycle influences its approach to coopetition by shaping its priorities.
In the earlier stages of start-up development, where overcoming liability of newness is a critical issue, founders are primarily concerned with survival and establishing a market presence; hence they prioritise short-term goals over coopetition and knowledge exchange for sustained growth and innovation that will benefit all stakeholders in the ecosystem:
Collaborating and working with other founders in an ecosystem takes time and effort. It’s more of a medium to long-term growth strategy to be part of the ecosystem. Often the results are more medium- to long-term too; there’s not an immediate return on investment.
We have resource constraints and need to focus our resources on what our needs are now. But if the right opportunity arose, we would leverage opportunities for exchange of knowledge and other resources with competitors. (Interviewee #24)
Interviewee # 21 illustrates such knowledge exchange in their start-up community:
In our startup community, founders reciprocate; you’re more willing to share knowledge and experiences because they’ve shared with you. And two startups almost never work on exactly the same idea. And even if they’re working on similar ideas, it’s a different market segment, a slightly different opportunity. So, there are more benefits to be had by cooperating and sharing knowledge, experiences and expertise. (Interviewee # 21)
Thus, each actor expects to give and to receive information and knowledge, with normative expectations of reciprocity governing their interactions. Hence, a further theme is that discrete exchanges of knowledge and expertise provide a basis for relational development that underpins long-term coopetition.
In summary, early-stage start-ups have common goals and create the foundations for long-term cooperation and knowledge exchange that are essential to their success. Companies that align their objectives are more open to cooperation with other companies, which benefits the entire ecosystem and increases individual results. Although short-term survival often takes precedence due to limited resources, knowledge exchanges provide the basis for future relationship growth. This spirit of collaboration builds trust, lays the foundations for continuous cooperation and promotes continuous learning and innovation. As a result, start-ups that accept shared visions and commit to collaboration are more likely to succeed.
This leads to the following proposition:
The potential for coopetition for knowledge exchange in the start-up ecosystem over the long term is associated with early-stage start-ups that share the same goals and have a stated commitment to long-term collaborations, with discrete occurrences of knowledge exchange providing opportunities for relational development.
5.2 Shared goals and values and mature start-ups: a relational approach to coopetition and knowledge exchange
A relational approach to coopetition and knowledge exchange comprises shared goals and values, and coopetition that is sustained over time among mature start-ups. Interviewee RBV, Managing Director of a highly successful ag-tech start-up that “prides itself on its collaborative approach to other actors in the ag-tech sector” highlighted this pattern:
We want to work with people that not only have the same goals but most importantly, the same values – the same ethics, behaviours and professionalism. We have established very close alliances over time with trusted people in competing digital agriculture businesses [who] we’re always talking to, What are they up to? What do they see as opportunities? How can we work together? But if my competitor has the same goal as me but different values, I wouldn't work with them. (Interviewee #13)
Thus trust, developed over time between founders from rival firms is a prerequisite to coopetition that enables the exchange of information and knowledge, while relational norms explicate expectations and rights and responsibilities that facilitate successful coopetition.
Results also indicate that the stage of the start-up, and in particular, maturity of the start-up influences the extent of openness and willingness for coopetition to exchange knowledge. Results indicate that founders of growing, mature start-ups are more open about their plans and strategies and view coopetition as an opportunity to innovate and grow; this openness creates an environment more conducive to knowledge sharing and exchange:
As a mature startup you're more confident in your go to market and you're generating more revenue and scale, you become more open to collaboration and knowledge sharing and exchange. (Interviewee #13)
The founder of another mature start-up engaged in vertical coopetition – providing an email marketing application to a major e-commerce platform which, in addition to using the start-up’s app, developed its own in-house email marketing – stated that on the one hand, it’s:
Source of new users is suddenly competing with us. (Interviewee #32)
On the other, this interviewee stated that:
We have also found the best opportunities have come through one-to-one meetings with their people. So, we really focus on maintaining, sustaining and leveraging those relationships. So literally flying to San Francisco, sitting down, having a coffee, talking, sharing, asking about their roadmap. That has led to the biggest opportunities for us. For example, they say, “We're getting this request from a ton of users, have you thought about adding it to your app?” And so, we did. That sort of stuff not only benefits the user experience, but is what's given us a big, big opportunity for growth on the platform. (Interviewee #32)
Thus, mature start-ups emphasise collaboration, knowledge sharing and ecosystem building, recognising the benefits of working together to create value for customers. The emphasis on value creation is underpinned by their favourable position in the market due to their advanced knowledge, expertise and progress:
We're open about what we're doing. And we can say that without fear or favour, because it will take competitors three or four or five years to catch up with the knowledge that we've got. So why would I care if I was sharing with them knowledge about what we are planning to do? If the customer decides that your product is better than mine, I'm not going to see that as a threat. I'm going to see that as an opportunity for me to innovate and be better. (Interviewee #6)
Relatedly, the founder of another mature start-up in the banking industry argued that coopetition is not a “zero-sum game” (Interviewee #2):
We're constantly exchanging knowledge, sharing experiences. Every week we have competitors really keen to learn about the organisation, what we've done and how easy would it be to replicate it? I would be very pleased to see imitation, because the more new entrants into the banking market that are successful, then the better it is for everybody. I'm a great believer in the concept of coopetition. You can actually cooperate to compete, and we shouldn't see this as a zero-sum game. (Interviewee #2)
Overall, mature companies with a common objective and value often establish strong and trust-based relationships with their competitors, creating continuous cooperation and open exchange of information and creating a support ecosystem. Transparency in their plans and strategies helps them to innovate and grow. These start-ups do not see cooperatives as zero-sum games, but as opportunities for mutual benefit and industry development. Therefore, the relationship approach to co-operation (based on common objectives, values and mutual standards) is crucial to the long-term success and creation of value for mature start-ups. This gives rise to the subsequent proposition:
A relational approach to coopetition and knowledge exchange is associated with mature start-ups that share goals and the same values, and relational norms that sustain collaboration over time.
5.3 Lack of shared goals and early-stage start-ups: transactional approach to coopetition and knowledge exchange
A transactional approach to coopetition and knowledge exchange emerged as an alternate approach to the relational approach. A transactional approach comprises short-term exchanges of knowledge and other resources between start-ups that seek to gain immediate, mutual benefits, rather than longer-term collaborations. These dyadic interactions are often opportunistic, and do not involve shared goals or long-term commitments:
We’re focused on immediate gains. We engage in specific projects with competitors when it aligns with our current needs and makes sense financially. “Collaborating [with competitors] allows us to leverage our competitors’ strengths and resources without committing to long-term relationships. It’s a pragmatic approach.” (Interviewee #18)
Results also indicated that a transactional basis for coopetition and knowledge exchange was prevalent amongst early-stage start-ups, as it enabled new ventures to engage in short-term, mutually beneficial transactions without the need to form long-term partnerships or share proprietary information which has limited protection:
The focus of sharing knowledge is to address specific challenges and optimising resource allocation while maintaining our competitive position. Interviewee #5
Thus, this transactional approach allows coopetiting start-ups to achieve specific goals without compromising their overall competitive stance. It’s a pragmatic, instrumental, approach to leverage knowledge and other resources for mutual advantage in select areas, given a start-up’s resource limitations:
In most early-stage startups, resources and time are in short supply. We need to allocate resources to things that gets us results. Startups really need to get some results within a year or a couple of years. So, we’d only exchange knowledge to achieve an outcome we couldn’t achieve alone. So, cooperating with a competitor is a means to an ends. (Interviewee #16)
Early-stage companies often adopt a transactional approach to cooperative cooperation and knowledge exchange in search of immediate and practical benefits rather than long-term partnerships. This methodology focuses on short-term opportunistic exchanges to help start-ups address short-term challenges without committing to ongoing collaboration or common goals. For start-ups with limited resources and high expectations for rapid results, this approach allows them to rely on external strengths while protecting their competitive advantages. Using short-term specific interactions, entrepreneurs can effectively manage resources and achieve results, making this strategy a smart choice for early-stage businesses. This results in the following proposition:
A transactional approach to coopetition and knowledge exchange is associated with early-stage start-ups that engage in short-term exchanges for immediate, mutual benefits and do not require shared goals or commitment to long-term collaborations.
5.4 Lack of shared goals and mature start-ups: no coopetition
A final group of mature start-ups do not engage in coopetition and maintain a competitive stance, avoiding any form of cooperation with competitors. These start-ups stated that they do not share goals with competitors, as they do not want to disclose or share any knowledge; informants considered everything that they do to be highly unique and confidential:
We play our cards close and will never collaborate [with competitors]. We don’t want to share. (Interviewee #17)
These start-ups view competitors strictly as adversaries and a threat that can encroach on their market position:
We see other startups – as intruding in the space where we are; they’re competitors rather than collaborators. (Interviewee #20)
A further pattern cutting across these start-ups was the importance of secrecy and independence in safeguarding proprietary information, with informants unwilling to compromise on these values for coopetition, knowledge exchange, or other resources. As more established ventures, they prioritise guarding their intellectual property and market position over cooperating with competitors.
For mature start-ups who choose not to participate in cooperation, they avoid sharing goals and knowledge with competitors and give priority to confidentiality and independence to protect their own information and market position. They see competitors as threats rather than potential collaborators. This approach reflects the strategy of maintaining competitive advantage and respect for confidentiality over potential benefits of cooperation. For these start-ups, avoiding co-operation is essential to maintaining market dominance and preserving their innovations and knowledge, as well as influencing their success by ensuring their secure competitive position. This leads to the following proposition:
Proposition 4: The lack of coopetition and knowledge exchange arises when mature start-ups, possessing established foundations, do not need to depend on collaboration for exchanging knowledge and an absence of shared goals and divergent values.
6. Discussion
This research looked to further the understanding of coopetition in start-ups by explicating the influence of goal congruity variation and a new venture’s lifecycle stage on start-ups’ approaches to coopetition. By developing a model, this research shows how these factors influence start-ups’ coopetition approaches, advancing knowledge on coopetition business networks (McGrath et al., 2019b), revealing how and when shared goals and a venture’s lifecycle influences the coopetition approach in new ventures. The theoretical significance of the model lies in our limited understanding of the combined impact of goal congruity – or absence thereof – and a venture’s lifecycle on coopetition in new ventures, with much of the extant business network literature on start-ups at a nascent theoretical understanding (O’Toole and McGrath, 2018), particularly business network research on coopetition (McGrath et al., 2019b).
The findings of co-coopetition at the stages of the lifecycle of start-ups are closely aligned with the existing literature on this topic. For early start-ups, the importance of shared goals to promote long-term cooperation and knowledge exchange reflects the theoretical understanding that such cooperation improves start-up performance and innovation. Bengtsson and Kock (2014) argue that cooperation involves a paradoxical relationship in which companies engage in cooperative and competitive interactions. When setting goals, early-stage start-ups lay the foundations for dynamic interaction and foster a collaborative environment supporting mutual growth (Bacon et al., 2020; Liu et al., 2023). This is consistent with literature that emphasised the role of common goals in the collaborative solution of problems and resource exchange (Li et al., 2010; Inkpen, 2008).The results showed that shared goals provide a basis for potential coopetition and knowledge exchange over the long term among early-stage start-ups; however, the liability of newness and smallness (Aldrich and Auster, 1986; Stinchcombe, 1965) shaped early-stage start-ups’ short-term priorities. As limited resources characterise early-stage start-ups, they prioritise short-term goals and survival rather than opportunities for potential coopetition (Batra et al., 2022) where the returns are expected in the longer term. Wider industrial network research (McGrath et al., 2019a) has also acknowledged that network activity is constrained by the new venture’s need to access resources to survive.
Consistent with the literature on the exchange theory of relationship development new ventures (Blau, 1964; Huang and Knight, 2017), results revealed that early-stage start-ups also leverage discrete opportunities to engage in coopetition for knowledge exchange with other start-ups, with reciprocal exchanges of knowledge constituting the building blocks of relational development (Blau, 1964; Huang and Knight, 2017). While this pattern also aligns with McGrath et al. (2019b) observation that entrepreneurs engage in a recurrent cycle of action and interaction with coopetitive actors, their driver was the entrepreneurial coopetitive mindset. Similarly, McGrath et al. (2018) document the development of relational capability to meet core customer/supplier needs; however, it occurred without shared resourcing, in contrast to this study where knowledge exchange was the basis for relational development among early-stage start-ups.
In contrast, mature start-ups that adopt a relational approach to coopetition build on the work of Dowling et al. (1996) and Ritala (2009), who highlighted the advantages of long-term, trust-based relationships. By sharing common goals and values, these firms cultivate a supportive ecosystem where continuous collaboration fosters innovation and industry advancement (Efrat et al., 2022; Liu et al., 2023). This relational approach aligns with the literature’s view that cooperative interactions can yield significant benefits beyond those achieved through competition alone (Czakon et al., 2014). Although we did not explicitly focus on the process perspective, our findings suggest that potential coopetition evolves into a relational approach as collaboration, knowledge sharing and resource exchange are sustained over time in mature start-ups. This approach, characterised by shared goals, values and trust, facilitates the exchange of knowledge and resources and supports problem-solving processes (Goswami and Agrawal, 2020; Inkpen, 2008). Relational norms also play a crucial role in mitigating risks (Akpinar and Vincze, 2016). In addition, founders of mature start-ups often demonstrate greater openness (Bacon et al., 2020), creating an environment that promotes knowledge sharing, innovation and growth. These findings highlight the importance of integrating industrial network theories with t and KBV approaches, highlighting a multi-theoretical perspective.
On the other hand, findings reveal that early-stage start-ups, when lacking shared goals, tend to adopt a transactional approach to coopetition. These start-ups engage in short-term, goal-oriented collaborations that address immediate needs without the commitment and costs associated with long-term partnerships. This transactional approach aligns with the literature, which sees initial collaborations as opportunistic and short-term. It allows start-ups to gain immediate benefits while preserving their competitive edge, reflecting McGrath’s (2019) insights into the pragmatic strategies of early-stage ventures. By focusing on specific challenges and leveraging immediate opportunities, early-stage start-ups embody the practical aspects of coopetition, highlighted by Akpinar and Vincze (2016) and Cygler and Sroka (2017).
Finally, without shared goals, results revealed that mature start-ups choose not to share and exchange knowledge with competitors, prioritising secrecy and competitive advantage, which aligns with the literature about the complex balance between cooperation and competition (Gupta et al., 2022; Ricciardi et al., 2022). O’Toole and McGrath (2018) also highlighted the independent mindset of the start-up founders (Birley and Westhead, 1994) as a barrier to network activity. These firms’ reluctance to share knowledge or collaborate echoes the concerns about maintaining competitive advantage and protecting proprietary information, as highlighted by Monticelli et al. (2022) and Ritala (2009). The strategic choice to forgo coopetition to protect their market position reflects a cautious approach that values confidentiality over potential cooperative benefits.
Overall, the nature of the coopetition approach evolves with the lifecycle stage of start-ups, highlighting the varying strategic approaches that influence start-ups’ success (Huang and Knight, 2017; McGrath et al., 2018).
7. Conclusion and implications
This study provided a granular understanding of coopetition in start-ups by shedding light on how variations in goal congruity and a venture’s life cycle influence approaches employed by start-ups engaging in coopetition in industrial markets. We offer valuable insights into when and how start-ups engage in cooperative interactions by synthesising these factors influencing coopetition approaches in new ventures into a model. The findings reveal that while early-stage start-ups prioritise short-term, transactional collaborations due to resource constraints, mature start-ups are more likely to embrace relational approaches based on trust and shared goals. This distinction highlights the importance of tailoring coopetition strategies to a start-up’s needs and development stage.
The managerial implications derived from this study guide start-ups in navigating coopetition. By understanding the specific approaches associated with variations in goal congruity and stage of start-up life, managers can tailor coopetition to their unique circumstances. The results underscore the role of shared goals in fostering knowledge sharing. Managers aiming to enhance knowledge exchange should prioritise cultivating shared goals among coopetitors. This can contribute to a cooperative environment where knowledge flows more freely, benefiting all actors involved.
Recognising the start-up’s stage of life is also crucial. Mature start-ups are more likely to adopt a relational approach to coopetition or choose not to engage in coopetition at all. Conversely, early-stage start-ups are associated with potential coopetition in the long-term or a transactional approach. Managers should tailor their coopetition strategies based on the specific challenges and opportunities relevant to their start-up’s stage of development. For mature start-ups, emphasising a relational approach can contribute to long-term collaborations, while early-stage start-ups might benefit from transactional engagements to address immediate needs.
Our findings offer actionable directions for managers. For early-stage start-ups, managers, constrained by limited resources, can strategically engage in short-term competitive collaborations to meet immediate needs. This transactional approach allows start-ups to gain critical resources and knowledge without the commitment of long-term partnerships, which may be more feasible as they mature and stabilise. Our research highlights the importance of fostering shared goals, values and trust for mature start-up managers to sustain long-term competitive relationships. This relational approach facilitates the exchange of knowledge and resources and enhances problem-solving processes, innovation and growth. Furthermore, the openness of mature start-up founders, as highlighted in our findings, is crucial in creating an environment conducive to coopetition. Therefore, managers should actively work to build and maintain trust within their coopetitive networks.
At a societal level, this research emphasises the role of coopetition in fostering innovation and resilience within the start-up ecosystem. By understanding the conditions under which start-ups are more likely to engage in coopetition, policymakers and support organisations can better tailor their programs and interventions to encourage such collaborations, particularly during the critical early stages of a start-up’s lifecycle, which can lead to a more vibrant and dynamic start-up ecosystem, with greater opportunities for innovation and economic growth.
The study’s limitations also have implications for future research. We analysed the coopetition approaches of tech-based start-ups; consequently, the results may not be able to be generalised to start-ups in other industries with different characteristics, providing a direction for further research. Comparative analyses across industry sectors could uncover industry-specific nuances in coopetition strategies. Research could investigate whether certain approaches are more prevalent or effective in specific sectors and the reasons behind these patterns. This would contribute to industry-specific insights that can inform decision-making.
The findings also rely on insights from interviews, and the potential for bias exists. Although we used a combination of primary and secondary data, a second interview and/or interview with the start-up’s partner in coopetition, could improve the robustness of the findings.
While our focus was on the influence of the stage of the lifecycle and goal congruity, future research could further investigate the identified four approaches to coopetition among start-ups. Exploring nuances within each category and understanding the specific factors influencing the adoption of these approaches would contribute to a more fine-grained, holistic typology. In addition, understanding the mechanisms through which shared goals influence openness, knowledge sharing and relational approaches would provide insights into coopetition. Similarly, investigating the outcomes of transactional approaches when shared goals are absent also warrants attention. Further exploration of the stages of the lifecycle of start-ups about coopetition is essential. Longitudinal studies that track the evolution of coopetition approaches among start-ups over time could offer valuable insights. Understanding how start-ups transition between different coopetition strategies as they progress through their life stages would provide a dynamic perspective on the adaptive nature of coopetitive behaviours.
The identified research directions provide a roadmap for future investigations into start-up coopetition. Addressing these avenues can contribute to a more nuanced and comprehensive understanding of the factors influencing coopetition approaches, thereby advancing theoretical knowledge and practical insights in industrial networks.
