Becoming an Entrepreneur: A Theory of Entrepreneurial Identity

This paper focuses on the nascent entrepreneurial process from an identity-based perspective. We build on research in the role identity, entrepreneurship, and career literature to develop a multi-dimensional concept of entrepreneurial identity. We link entrepreneurial identity to the nascent process by detailing how it influences the way individuals explore an opportunity or business idea, interpret environmental feedback, and evaluate alternatives. Through these processes, entrepreneurial identity influences key outcomes of the nascent stage, including whether nascents persist or abandon their efforts to become entrepreneurs.-3-Entrepreneurship research has accumulated a large body of empirical evidence about the survival and performance determinants of start-up businesses. Yet, for many years, the processes that led to the ir founding received little systematic examination. It has only been during the last decade that researchers have sought to systematically examine the processes of venture gestation by focusing on the figure of the " nascent entrepreneur " or " those persons currently taking explicit steps to start a new business (Reynolds & White, 1997: 40). " This area of research promises to illuminate early selection processes that lead to the formation of new businesses (Aldrich 1999). To use the objective-subjective dichotomy that has organized research on careers (Barley, 1989), research on nascent entrepreneurship has primarily focused on the objective factors that influence entrepreneurial activity. The objective stream emphasizes observable activities or facilitators of the individual or team that makes entrepreneurial activity an attractive career path and the environmental factors that serve as a selection mechanism (Aldrich, 1999; Carroll and Mosakowski, 1997). Recent empirical studies of nascents have found that they have higher education levels and work experience than a control sample (Davidson and Honig 2003). When followed over time, nascents who took business classes and were a member of a business network were linked to indicators of successful business founding (Davidson and Honig 2003). The focus on the objective also assumes that the achievement of relevant milestones are critical to the start-up stage and that the inability to achieve specific milestones should explain why some nascents decide to give up. However, studies show that there are few consistent predictors (writing a business plan and creating a legal-4-entity) of persistence from an extensive list of activities that were tracked (Shane and Delmar 2004; Delmar and Shane 2003). Surprisingly, as a broad measure of milestone achievement, the total number of start-up activities undertaken has an equivocal relationship to persistence when comparing …