CFO Recruitment. We have already addressed executive succession as an important means of facilitating higher-order learning in organisations. Another way to increase the heterogeneity in the management team is the recruitment of additional top managers. By hiring highly skilled senior executives and thus extending the top management team, new ventures can increase their managerial capacity (Xxxxxx 1983; Xxxxxx and Toulouse 1986), which is important for company growth (Penrose 1959). While the replacement of the founder has a positive influence on the performance of firms in turbulent environments, the results may even be better when keeping the CEO but changing the management team (Virany, Xxxxxxx, and Romanelli 1992). The positive influence of recruiting a CFO on managerial capabilities was emphasised by the CEO of an internet publishing company. “I simply needed somebody who knows the business of mid- sized companies. I brought in this new CFO whom I knew as a professional manager with experience in restructuring and controlling and told him that he should care about finance and human resources (…) Our CFO had six or seven years of experience in human resource management. He brought all the human resource practices and systems to the organisation and implemented them.” Considering the engineering and science background of many founding teams, new ventures may lack personnel with a strong background in the management of finance. Thus, technology-based start-ups often hire managers with financial expertise. The existence of financial skills within the top management team has a major influence on the performance of young firms (Xxxxxxxx, Xxxxxx, and Xxxxxxx 1996). The extension of a technology-oriented founding team is supported by empirical research which promotes a negative association between founding team heterogeneity and team member entry (Ucbasaran, Xxxxxxx, Xxxxxx et al. 2003). Thus, I derive my next hypothesis.
