Outside directorsʹ experience, TMT firm-specific human capital, and firm performance in entrepreneurial IPO firms

Drawing on the behavioral agency perspective and entrepreneurship literature, we examine the impact of board configuration at the time of an IPO on top management team (TMT) firm-specific human capital, and firm performance in young IPO firms. The results show that the ratio of outside directors at the time of an IPO has a positive relationship with the attrition of TMT firm-specific human capital in the first two years following the IPO. Outside directorsʹ industry- and firm-specific experiences negatively moderate this relationship. Finally, our study provides evidence that TMT firm-specific human capital attrition negatively affects subsequent firm performance.