This study examines the conditions under which new ventures valorize employment as a strategic orientation. Challenging conventional efficiency-based views of entrepreneurship, we theorize that such employment valorization emerges not from financial constraints but from founder community origin. Specifically, we argue that founder origin, venture location, and local multiplex relationships shape the valorization of employment. We argue that these conditions foster commitments to community stakeholders, reconfiguring employment from an economic input into a core purpose of firms. Using a dataset of 25,905 ventures founded in Japan between 1998 and 2007, our findings extend research on entrepreneurship and community by showing how place-based founder ties and relational engagement shape employment decisions in new ventures.
Communities in developed economies increasingly face devitalization due to uneven development and economic fragility. How do some local communities create civic wealth — social, economic, and communal wealth that enhances the local community — amid the downward spiral of collapsing industries, relocating businesses, and brain drain? In this paper, we develop a conceptual model that theorizes how community entrepreneurs leverage community members' sense of place, i.e., the attachment and identification that individuals have with a place, to activate an upward spiral of civic wealth creation (CWC) in the context of devitalization. We connect research from human geography, environmental psychology, and related fields with community and entrepreneurship research to unpack how leveraging sense of place activates three core processes of CWC in devitalized communities: engaging community members, mobilizing place-based resources, and collaborating for local innovation. Our model depicts how sense of place is key to building communal wealth — capital created to enhance the community's capacity, cohesion and cultural assets — which in turn is essential to ensuring the other types of civic wealth (i.e., social and economic) benefit the community, thus creating upward momentum. With our model, we contribute to research at the nexus of community and entrepreneurship, including growing literature on CWC.
We highlight the role that psychological reactance via the underdog effect (i.e., the need to prove others wrong) plays in eliciting direct and indirect entrepreneurial action. Drawing on psychological reactance theory (PRT), we examine how negative socio-emotional stimuli can result in a strong individual motivation for entrepreneurs to persist with their ventures. Further, we highlight entrepreneurial hustle (direct action), entrepreneurship-related media engagement (indirect action), and obsessive thinking (indirect action) as mediating mechanisms linking the underdog effect to venture persistence. We test our theory-driven model across three studies. Findings from two quasi-experiments (Study 1, N = 424; Study 2, N = 579) which include 15 post-hoc interviews with entrepreneurs as part of Study 2, as well as a time-lagged mediation model (Study 3, N = 417), provide strong evidence consistent with the inference that venture persistence is closely linked to the underdog effect. We discuss multiple theoretical and practical implications that our work illustrates, and we offer numerous future research directions. Executive summary Persistence is widely recognized as an essential quality for entrepreneurs to have, yet existing research primarily focuses on positive motivators such as passion, self-efficacy, and entrepreneurs' identity. Far less attention has been directed to how negative socio-emotional experiences, like doubt or discouragement, can also fuel entrepreneurial persistence. We add to our understanding of entrepreneurial persistence by elaborating on and testing theory related to underdog entrepreneurs. Specifically, we address the cognitive and self-regulatory aspects of entrepreneurs' motivation from seemingly disempowering external forces, and we explore how entrepreneurs' responses to such negative feedback can drive sustained action. Across three empirical studies and 15 interviews of entrepreneurs, we apply Psychological Reactance Theory (PRT) to explain how individuals are motivated to restore their freedom to act when they feel that their desired behavior is threatened (e.g., doubts of being a successful entrepreneur). We find strong support for our theory-driven model, showing that negative stakeholder feedback can elicit an “underdog effect,” motivating entrepreneurs to prove others wrong and ultimately leading to sustained entrepreneurial action (i.e., venture persistence). We find that this motivational process is influenced by the perceived credibility of the naysayer, where low perceived credibility relates to even higher levels of one's desire to prove the naysayer wrong. Finally, in testing our model, we show how the underdog effect translates to sustained action through the conceptual mediators of direct and indirect entrepreneurial action. Here, we highlight entrepreneurial hustle as a proxy of direct entrepreneurial action, and entrepreneurship-related media engagement and obsessive thinking about entrepreneurship as two indirect actions linking the underdog effect to venture persistence. Overall, our work provides a new motivational lens for understanding why and how entrepreneurs persist with their ventures. Findings from three empirical studies and a post-hoc analysis highlight how entrepreneurs' internal socio-affective responses towards adversity (i.e., external sources of disempowerment) can become a powerful motivational force to persist. Rather than discouraging entrepreneurs, we find evidence that underdog expectations can cause “boomerang effects” in entrepreneurs' behavior and ultimately sustain their determination to become successful entrepreneurs. This nuanced theoretical approach provides an extension to current theory on underdog entrepreneurs and a more complete view for how entrepreneurial motivation relates to entrepreneur action and venture persistence.
We study how a French social venture helped scale up social impact by selling fair-priced milk. Besides market success, the venture became a symbol of fair pricing for farmers, influencing public discourse and inspiring new laws. We develop a process model where energized consumer solidarity framing serves as a catalyst for mobilizing ecosystem actors, leading to the widespread adoption of the venture's solution to an economic and social crisis. This distributed process of scaling up social impact unfolds outside the venture's direct control, relying on community enactment as well as engagement and energizing from the media, incumbent retailers and competitors, as well as politicians. We contribute to research on scaling up social impact by explaining how and why entrepreneurial framing can mobilize diverse ecosystem actors. We also advance entrepreneurial framing research by offering a social-emotional explanation of how framing can enable change. • French co-op helping farmers scaled up social impact with limited resources • Social entrepreneur used energized consumer solidarity framing to engage ecosystem actors • Diagnostic, prognostic, and motivational frames mobilized ecosystem actors • Continuous energizing between the entrepreneur and ecosystem actors enabled scaling up • Positive and negative emotions can be regulated in entrepreneurial framing
Large Language Models (LLMs) are poised to fundamentally reshape entrepreneurial work, but it remains unclear whether this technology can support judgment-intensive entrepreneurial tasks. Prevailing skepticism holds that LLMs are inherently unreliable for such deep augmentation because, despite their language competence, they do not think. In contrast, we draw on Ludwig Wittgenstein and Alan Turing to advance a language-centered perspective on entrepreneurial work. Wittgenstein demystifies thought as linguistic activity and treats reasoning and understanding as linguistic abilities exercised in thinking. Extending this stance to the domain of machine intelligence, Turing grounds claims about intelligence in testable performances of language use. Together, they enable us to (1) conceptualize LLMs as an epistemic technology whose linguistic competence may suffice for the deep augmentation of entrepreneurship and (2) reorient research from skepticism toward fine-grained Turing tests of entrepreneurial work. We illustrate and support the language-centered perspective through two studies on crafting effective entrepreneurial narratives, a judgment-intensive task. Initially, we document that the LLM competently blends expert rhetorical strategies to create and refine narratives that effectively align with stakeholder needs. We then experimentally demonstrate that, when coupled with stakeholder-guided iterations, LLMs produce measurable improvements in narratives tailored to distinct stakeholder priorities. More broadly, our rethinking of entrepreneurial work through language-centered lenses helps theoretically support bold predictions about what entrepreneurs can accomplish with a nonhuman intelligence that has “only” mastered human language. • Challenges the philosophical underpinnings of skepticism about LLMs in entrepreneurial judgment • Positions LLMs as epistemic technologies for deep augmentation in entrepreneurship • Proposes a research program of fine-grained, task-specific Turing tests for entrepreneurial work • Demonstrates LLMs can craft and iteratively refine effective entrepreneurial narratives across diverse stakeholder priorities • Documents that LLMs help remove a key entry barrier to entrepreneurship