Four years on: Are the gazelles still running? A longitudinal study of firm performance after a period of rapid growth. (June 2016)

• Record Type: Journal Article
• Authors: Senderovitz, Martin; Klyver, Kim; Steffens, Paul
• Is Part Of: International small business journal. Volume 34:Number 4(2016)
• Page Start: 391
• Page End: 411
• Publication Date: 2016-06
• Subjects: gazelle firms -- growth -- profitability -- strategy; Small business -- Periodicals; 338.64205
• DOI: 10.1177/0266242614567483
• Languages: English
• ISSNs: 0266-2426

Abstract

This article examines variations in performance between fast-growth – the so-called gazelle – firms. Specifically, we investigate how the level of growth affects future profitability and how this relationship is moderated by firm strategy. Hypotheses are developed regarding the moderated growth–profitability relationship and are tested using longitudinal data from a sample of 964 Danish gazelle firms. We find a positive relationship between growth and profitability among gazelle firms. This relationship is moderated, however, by market strategy; it is stronger for firms pursuing a broad market strategy rather than a niche strategy. This study contributes to the current literature by providing a more nuanced view of the growth–profitability relationship and investigating the potential for the future performance of gazelle firms.