Which subfield to enter first?: The role of a firmʹs pre-entry experiences

In this study, we draw from the organizational experience and market entry literature and investigate if a firmʹs pre-entry experiences predict which subfield to enter first. We employ a unique data set from the biotechnology industry where two distinct subfields emerged around the same time due to a revolutionary discovery. Among the firms that entered one of the two emerging subfields, we examine the relationship between pre-entry experiences and which subfield a firm enters. Our key finding is that general experience rather than specialized experience increases the likelihood of a firm entering first the subfield with higher level of uncertainty as opposed to the subfield with lower level of uncertainty.