| This dissertation investigates the effects of geographic distance and interorganizational networks on the acquisition strategies of high-technology firms. This effect is examined through analysis of M&As made by Cisco Systems, a dominant incumbent in the computer networking industry. In the 1990s, this industry experienced a dramatic inflow of new entrants introducing technological novelties, yet the level of industry concentration remained high. Acquisition strategies aimed to capture external technology knowledge are theorized to play a critical role in preserving oligopoly. Analysis reveals that incumbents selectively acquire innovation-driven start-ups to preserve their market dominance. The results indicate that incumbents are more likely to acquire start-ups co-located to their premises. The results further indicate that incumbents require a strong patent base when acquiring remote targets. Finally, incumbents are more likely to acquire targets that have been funded by prominent venture capitalist firms. |
