The Impacts of Externally Hired Senior Technology Executives on Startup Complementor Innovation in Software Platform Ecosystems

This research examines how externally hired senior technology executives reshape product innovation in startup complementors operating within software platform ecosystems. We distinguish two innovation types tied to the platform’s layered modular architecture: layer-expansion innovation that extends products into previously unused technical layers, and within-layer innovation that deepens the use of layers already embedded in the complementor’s products. Using longitudinal data from startup complementors in the Hadoop ecosystem, we find that externally hired senior technology executives are positively associated with layer-expansion innovation but negatively associated with within-layer innovation, indicating a reallocation of innovation efforts across platform layers. Drawing on the cognitive and technical dimensions of tacit knowledge, we theorize that externally hired senior technology executives influence innovation by introducing knowledge from their prior experience in technology and product development. Multiple mechanism analyses provide evidence consistent with this knowledge-based explanation. The innovation effects are stronger when executives are hired into newly created positions and when their prior expertise extends beyond the startup’s existing technical layers. We also find that these effects are more pronounced among growth-stage startups and startups without senior technical founders. This research contributes to the software platform ecosystem, executive human capital, and entrepreneurial innovation literature by investigating the impact of externally hired senior technology executives on startup innovation relative to the platform’s layered architecture.