Based on dynamic capabilities theory, a model is proposed and elaborated to research the technology-based SMEs in Zhongguancun. According to analyzing the regional environment and development status of the technology-based SMEs in Zhongguancun, the important roles of universities, research institutes, financial institutions and government departments played in the growth of the technology-based SMEs are taken into account. To investigate the model, a company’s case was studied and illustrates the external institutions’ important roles in the development of firms’ dynamic capabilities.