Time is an overlooked but important condition in the TMT heterogeneity— performance link. Drawing on upper echelon and signaling theories, we examine the moderating effect of time (the age of the firm) on the relationship between informational and social category heterogeneity of top management teams (TMTs) and firm outcomes. We argue that the costs of heterogeneity will reduce the book value of the firm, but also that this negative effect will decline over time. We also suggest that when the firm is new, investors rely on TMTs’ heterogeneity as a signal for firm quality. TMT informational heterogeneity will increase the market value of the firm, while social category based heterogeneity will decrease this value. Over time, however, investors will rely less on the signals from TMT characteristics and rely more on the firm’s track record; hence as firms age, the impact of TMT heterogeneity on market value will lessen.