Breaking traditions: an investigation of innovation risk-taking among copreneurships post-IPO

Purpose This study explores the relationship between copreneurship, a unique type of start-up established by cohabiting couples and innovation risk propensity. There is a growing debate in research regarding whether copreneurships differ from other types of start-ups and whether they lead towards risky behaviours in the context of firm-level strategic decisions. Building on upper echelons theory and household decision-making theory, this study attempts to uncover how copreneurs’ risk propensity affects corporate innovation in successful enterprises. Design/methodology/approach Information on firms co-founded by cohabiting couples was manually collected from the prospectuses of Growth Enterprise Market (GEM)-listed family firms in China. Data from 306 family firms listed between 2009 and 2018 and zero-inflated Poisson regression were used to test the theoretical model. An instrumental variable approach was used to address endogeneity, and propensity score matching was applied for robustness testing. Findings The results indicate that copreneurships engage in more breakthrough innovation activities than other types of family firms after achieving entrepreneurial success (i.e. successfully completing an initial public offering [IPO]). This relationship is affected by characteristics of copreneurs at three levels, namely individual, household and firm: copreneurs’ educational background (master’s in business administration [MBA] education experience), household decision-making negotiations (copreneurs’ age difference) and firm decision-making autonomy (copreneurs’ duality), respectively. The evidence shows that an MBA education and duality within the firm increase the number of breakthrough innovations, whereas age difference has no significant influence. Originality/value This study provides a dynamic perspective on the role of copreneurs in the post-IPO phase, highlighting their intrinsically high risk propensity relative to other types of family firms and its relationship with firm-level innovation. It offers practical implications for policymakers, venture capitalists, educators and human resource managers in supporting copreneurial ventures.