Socio-Cognitive Foundations of Entrepreneurial Venturing

Unpublished Ph. D Dissertation.

This dissertation employs a mixed methods approach to explore cognitive and social dimensions of entrepreneurial creativity and innovation. I interviewed 32 technology entrepreneurs to generate a grounded theory about how technology entrepreneurs use social behaviors, techniques and cognitive processes to attain, develop, refine, validate and filter (for usefulness) creative ideas for successful new products, processes or services. The results reveal a complex, cyclical and recursive multi-level social process with emphasis on iterative active and social experimentation. Successful entrepreneurs use experimentation to facilitate and accelerate learning, preferring to succeed or fail quickly. Greatest ideational productivity occurs when strong social ties interactively solve problems in an environment of trust – in particular, when “Trusted Partners” exchange and refine ideas through a form of shared cognition.

In the second study, I surveyed 172 technology entrepreneurs to determine the effects of learning style and learning flexibility on iterative decision methods and innovation decision speed, behavioral mediators hypothesized to produce 88 entrepreneurial innovation and success. The Kolb learning style preference for active experimentation predicted the entrepreneur’s use of iterative methods to innovate and achieve success. The anticipated positive indirect influence of learning flexibility on innovation surprisingly occurred via a chain of two consecutive negative effects. Entrepreneurs with high learning flexibility move less swiftly to make key strategic innovation decisions; however, in doing so they are more innovative.

The final study explores the traits and interactions of “Trusted Partners” and their impact upon entrepreneurial learning capacity, innovativeness and firm performance. I surveyed 153 technology entrepreneurs, all of whom report having a Trusted Partner, and discovered that effective partnerships more likely develop between two individuals with broad combined expertise (high Partner Functional Breadth). However, partner expertise diversity negatively affected the ability of partners to engage in constructive learning interactions and exploratory learning. I conclude that cofounder/partners ideally need both breadth and significant expertise overlap to facilitate the shared language and vision necessary for productive collaborative learning interactions. These findings show that broad but overlapping partner/co-founder expertise, when combined with a strong sense of personal trust, leads to elevated absorptive capacity, innovation and performance within entrepreneurial firms.