Events

Prof. Samina Karim
Professor
D’Amore-McKim School of Business
Northeastern University

As startups scale, they often professionalize their management structure, and the decision to appoint the first non-founder manager—whether through internal promotion or external hiring—may influence firm performance. Using employer-employee matched data from Brazilian firms founded between 2004 and 2010, we examine the relationship between this decision and firm survival. Distinguishing managerial human capital into firm-specific, industry-specific, and generic categories, we observe that firms promoting internal candidates tend to have higher survival rates, which we associate with the value of firm-specific knowledge. For firms hiring externally, performance outcomes vary based on the external hire’s industry and managerial experience. These findings contribute to research on organizational scaling, managerial human capital, and decision-making in growing ventures by exploring how early managerial roles are associated with startup performance trajectories.