How Do Firms Choose Their Names: Insights from Biotechnology

Abstract

In this paper, we explore patterns of name choices of entrepreneurial firms in the field of biotechnology. Drawing on the legitimacy argument and institutional entrepreneurship theory, we hypothesize that in the early years of the industry, entrepreneurs choose the names of their start-ups with greater focus on their unique sound. In these early years, we find that more start-ups select names that are longer, begin with rare sounds or plosives, and have stronger links to the biotechnology industry. We further argue that in the later years of the industry evolution, entrepreneurs are more likely to select names that are more generic. We find that in the later years of the industry, the start-ups select names that are shorter and with cues from technology and discipline. Our findings hold across 281 entrepreneurial firms in the field of biotechnology.