We add to the literature examining the ownership‐innovation relationship by examining two major investor types: corporate investors and family investors. We use organizational environmental scanning as a new perspective to understand how these investors’ capabilities influence firms’ external cooperation and innovation performance. We found that corporate investors with broad investment experience strengthen a firm's environmental scanning, enhancing innovation performance by increasing the number of external cooperation activities the firm engages in. Conversely, family investors' broad investment experience tend to be negatively associated with the number of external cooperations and with firm innovation. Our results show that investors influence firm innovation not simply through a monitoring role but also by affecting firms' abilities to innovate, once we factor in the types of investors and their capabilities.
Investor Experience and Innovation Performance: The Mediating Role of External Cooperation,