Rajshree Agarwal Directory Page

We examine how formalization in cognitive processes (theorization) and evidence evaluation (experimentation) influence the type (frequency and radicalness) and nature (impetus, clarity, and coherence) of entrepreneurial pivots. We use a mixed-method research design to analyze rich data from over 1,600 interviews with 261 entrepreneurs within a randomized control trial in London. A quantitative analysis that complements human-coded and machine learning-coded measures reveals that conditional on pivoting, theorization and experimentation are complementary in their association with making single radical pivots. The extensive qualitative-case comparison further elucidates interactions between theorization and experimentation that generate differences in the nature of pivots that range from purposeful (clear and coherent rationale deriving from articulated theory and experimentation), postulatory (informed by articulated theory but not incorporating nuances or surprises generated from experimentation), and remedial (stemming from adjustments to preformed theories that drew on prior experiences) to reactive (driven by environmental stimuli absent a clear theory of value). These insights contribute to the theory-driven strategic decision-making literature and offer practical insights for entrepreneurs, incubators, and policymakers on the benefits of a scientific approach to entrepreneurship.

Valentine, Jacob (Doctoral Candidate, University of Maryland); Novelli, Elena (Professor, Bayes Business School); Agarwal, Rajshree (Lamone Professor of Strategy and Entrepreneurship, University of Maryland)

• Enterprise and Markets
• Entrepreneurship
• Human Capital and Economic Development

We examine variation in high-technology startups’ performance based on founders’ pre-entry experiences by developing a formal model and using confidential employee-employer linked microdata from the United States to examine the empirical consistency of the model propositions. The model posits that relative to insiders, a lack of industry-specific experience creates greater epistemic uncertainty regarding optimal business models at time of entry for outsiders and thus, higher post-entry adjustment costs associated with necessary pivots.  Consequently, outsiders have a higher selection threshold for the value creation potential of the underlying technical ideas. Together, these mechanisms yield propositions that relative to insiders, outsiders have lower odds of survival on average, but higher growth and probability of being acquired. The empirical results indicate strong and robust support for these propositions.

Agarwal R. (Maryland Smith) Carnahan, S., (Wash. U. at St. Louis) Campbell, B. (Ohio State University), and Choi, J. (Federal Reserve

• Entrepreneurship and venture creation

We examine industry and technology (non-) emergence by integrating actor-centric and systems perspective literature streams. We use historical methods to analyze rich data tracking investments by actors spanning private, public and academic sectors in the solar PV context. The industry took several decades after commercialization to emerge; moreover silicon and thin film technologies experienced divergent fates despite firm takeoff. By uncovering critical interdependencies across activities by different actors, we show that while attention by all actors to developing various elements of technological systems is necessary for emergence, it may not be sufficient. The industry emerged after activities by technology producers, industry associations and government agencies ensured stable institutional support that stimulated latent demand (by utilities and end consumers) and created reinforcing loops among activities by technology producers and research institutes for solar technologies to become a viable alternative to fossil fuels. Moreover, silicon experienced additional reinforcing loops in demand side and supply-side ecosystems, wherein technology producers and equipment manufacturers leveraged adjacent mature supply chains to meet demand-side scale and reliability requirements in fast growing markets. In contrast, thin film experienced balancing loops wherein nascent, firm-specific supply side alliances could not address these demand side needs. These findings showcase how dominant designs may emerge even when there is no ex-ante competitive dynamics among technology producers: while silicon may have benefited from first mover advantage at the technology level, our study highlights that ecosystem first mover advantages of silicon relative to thin film were particularly salient in their divergent fates.

Guerra, M. (Bayes Business School) & Agarwal, R. (Maryland Smith)

• Public–private partnerships and cross-sector collaboration
• Environmental, social, and governance (ESG)