Creating Start-Ups for a Better World: The Venture Creation Process of ‘Missionary’ Founders

Abstract

How do ventures that are focused on solving social and environmental problems come into existence? Drawing upon social identity theory, this study focuses on the venture creation process of Missionary founders. More specifically, we investigate in what way the strength of a founder’s Missionary identity affects the relationship between two central entrepreneurial actions – i.e., conducting discovery and exploitation related start-up activities – and firm emergence. We test our hypotheses using binary logistic regression on a sample of 133 nascent entrepreneurs from a recent longitudinal study. Our results suggest that Missionary founders find it more difficult to develop and implement their business model in comparison to other founders, resulting in a different importance of discovery and exploitation related start-up activities, and, possibly, in some cases also leading to an escalation of commitment.