How do mission-driven ventures emerge? an investigation of startup activities and the achievement of regular sales among early-stage everyday entrepreneurs

Abstract Mission-driven entrepreneurs can only create an impact if they are able to advance their venture beyond the gestation phase to an operating firm with regular sales. We focus on what entrepreneurs do in the process of setting up business and draw on social identity theory to acknowledge differences between venturing efforts. Specifically, we investigate in what way the strength of founders’ missionary identity affects the relationship between two types of activities in the startup process (discovery-related, exploitation-related) and firm emergence. We test our hypotheses on a longitudinal sample of 135 nascent entrepreneurs, encompassing all kinds of startup attempts. Our results suggest that discovery-related startup activities aimed at identifying, evaluating, and developing a business idea are critical for mission-driven entrepreneurs while exploitation-related activities are also important and may require greater effort. We find indications that founders with a strong missionary identity are likely to exhibit commitment escalating behavior.