Managers of new firms are able to observe the competitive
environment before entry into a particular market.
Except for very rare circumstances, new entrants
must take competitive conditions as exogenous and craft
their strategies accordingly. The ability to generate positive
operating cash flows is a function of a firm's
resources and capabilities-both their initial endowments
and those that are developed in the course of doing business. The challenge of survival when young is
exacerbated by resource constraints and the absence of
established organizational routines. Younger firms may
have great difficulty generating sufficient revenue while
concurrently dealing with start-up costs that older enterprises
have long since absorbed