Selling Snake Oil and Unicorns: Performative Standardization in the Evaluation of Entrepreneurial Ideas
How do venture capital and angel investors evaluate entrepreneurial ideas in their earliest stages? Drawing on three sources of data—an ethnographic study of an annual pitch competition in Silicon Valley, archival data from this competition, and interviews with early-stage investors—this paper inductively examines how structural and temporal constraints within the startup funding ecosystem set the stage for a heretofore unexamined evaluation process. This study introduces this process—performative standardization—as involving the collaborative construction of an idea’s value by investors and entrepreneurs, followed by the assessment of this constructed value according to widely-shared investor standards. Paradoxically, the findings indicate that investors both acknowledge an idea’s quantified value to be subjective and unknowable, yet place weight on it when making evaluative decisions. The results further find that investors evaluate ideas more positively when pitches include aspects of performative standardization that meet their widely-shared standards. The findings together underscore the significance of performative standardization as a cultural process that serves not only to assess ideas at the point of evaluation, but also to coordinate and align stakeholders on a common trajectory toward actualizing an idea into a successful venture.
Is it the (Written) Expression that Counts? Gender and Hiring into Entry-Level Sales Jobs
(with Adina D. Sterling) R&R, American Sociological Review
Although sociologists have long recognized that variation within gender categories exists, most research on labor market inequality still focuses on outcomes between two groups: women and men. One way that people vary within gender categories is through their gender expression, or their conveyance of femininity, masculinity, both or neither in labor markets. Yet, little is known about how gender expression influences labor market inequality. We posit that written expressions of gender—text commonly used in labor markets such as on job applications—convey culturally embedded beliefs about gender that influence evaluators’ decisions. Using free-form responses on job applications for over 50,000 candidates for a customer-facing sales job, as well as computational linguistics, we find evidence that gender expression occurs through written text and corresponds to the selection of job candidates. Men that express higher levels of masculinity in their written responses, who are also White, are more apt to make it past the initial screening stage versus those who express lower levels of masculinity. Meanwhile, we find some evidence that written expressions are valued among a limited set of racial and ethnic minority groups. We close by discussing how a more expansive view of gender contributes to literature on gender, labor, and organizational inequality.
Founder Cognition and New Venture Outcomes
· Academy of Management Best Paper Proceedings
· Finalist, Best International Paper Award, OMT Division, Academy of Management
· Finalist, Best Entrepreneurship Paper Award, OMT Division, Academy of Management
How do entrepreneurs’ cognitions shape their ventures? While research has established that founders’ backgrounds and prior experiences shape their firms and firm outcomes with long-lasting consequences, these studies have largely taken for granted the underlying founder cognitions that transfer individual-level variation to the firm level. Little is known about how entrepreneurs think, and how their cognitions affect firm-level outcomes such as revenue. To uncover entrepreneurial cognition, this study uses a novel mixed methods approach. Using applications submitted online by entrepreneurs seeking funding from a nonprofit accelerator, an inductive grounded theory analysis reveals two diverging cognitions – an exchange construal and an organization construal – that reflect differences in how entrepreneurs think about themselves and their ventures. These findings are then scaled across 139,806 applications from entrepreneurs across Africa, using a supervised machine learning method, to test whether and how these construals influence firm-level outcomes. The results indicate that entrepreneurs’ construals are significantly associated with differences in firm revenue and acceptance into the accelerator. These findings suggest that entrepreneurial cognition at the time of founding is imprinted into the firm, illuminating a contributing factor to heterogeneity in new venture outcomes. The findings further suggest that founder background, including gender, contributes to differences in founder construals.