Abstract: This research aims to explore the influence of intellectual capital on the performance of MSMEs in East Java through the mediating role of innovation speed and innovation quality as well as the moderating role of knowledge management strategies. The research method uses Structural Equation Modeling (SEM), research hypothesis testing uses a structured questionnaire. The sample used was 125 SMEs in East Java using a random sampling method. The research results prove that intellectual capital has a significant effect on innovation, intellectual capital has no effect on the performance of MSMEs, however innovation can mediate the influence of intellectual capital on the performance of MSMEs, but knowledge management strategies cannot moderate intellectual capital and company performance. Overall, intellectual capital has a significant effect on MSME performance through innovation. The contribution of this research is pioneering research that develops a theoretical model to combine intellectual capital, knowledge management strategy, speed and quality of innovation and SME performance. With the intellectual capital owned by MSMEs, they can quickly create quality innovations so that they can improve the performance of MSMEs.

Key words: intellectual capital, innovation, knowledge management strategy, MSME performance

JEL code: O31, O32, M14