The Ontology of Entrepreneurial Opportunity

Abstract

This paper takes a fresh look at a core question in entrepreneurship: are opportunities objective, formed by exogenous shocks to pre-existing markets or industries that entrepreneurs then discover, or are they subjective, formed endogenously by the entrepreneurs who create them? The question is challenging, in part, because of the lack of consensus on the underlying nature of opportunity. Getting clear on the nature of opportunity requires distinguishing clearly between its ontological status (what it is) and its epistemological status (what we believe about it). We take a foundational approach, borrowing tools from philosophy, to look at the ontological structure of social institutions inside of which opportunities reside. We demonstrate that entrepreneurial opportunity, like the social structures in which they are nested, is ontologically subjective. As such, entrepreneurial opportunity is best understood not as a static object that sits fixed somewhere on the epistemological continuum between the subjective and objective but as the initial starting condition of a process vector that starts somewhere on that continuum but always moves across it (a greater or shorter distance) into increasing epistemological objectivity. Epistemologically, opportunity is the creative process of embedding a venture ever more deeply into the objective institutions where it needs to exist to thrive.