Exploiting an entrepreneurial idea requires the right combination of factors, timing, and sometimes sheer luck. I examine what it takes to help entrepreneurs who need more luck than most to act on their idea, persist in the initial stages of the entrepreneurial process, and develop a successful strategy – those who live in areas where access to resources is extremely constrained both pre-entry (education and labor) and post-entry into entrepreneurship (training, mentoring, and funding). Specifically, I investigate how entrepreneurial action, persistence, and strategy formation in early-stage ventures are influenced by ventures’ access to different types of resources and whether such resources can offset the large gaps in resource endowment. In investigating this question, I try to emancipate the literature of resource mobilization from its selection biases to determine the causal effect of access to resources within an environment with high levels of human, social and financial capital inequalities. Whereas existing research has identified the impact of acquired and endowed resources together, in enabling entrepreneurial action and persistence, far less attention has been devoted to understanding such impact when the gaps in endowment are large and the chances to access are equal. I posit that access to resources would help increase entrepreneurial action even when large gaps in human and social capital endowment exist because it increases the entrepreneurs’ self-perceived quality and gives them access to information that helps the entrepreneur plan and know how to act. I further predict that access to funding helps increase persistence because it gives the entrepreneurs the slack needed to access more of their cognitive and emotional resources. Moreover, financial resources help the entrepreneurs experiment and pivot so they can persist longer using different learning mechanisms. In short, I plan to contribute to the general knowledge for both academics and policymakers to design and implement entrepreneurial policies that make entrepreneurship a path to reduce inequality rather than means to increase inequalities.
Alignment with RRBM Principles of Responsible Research
Principle 1—Service to Society: Bridging the resource gap for entrepreneurs serves disadvantaged entrepreneurs and the broader society given that such gap spills over to the product market representing the needs of unprivileged individuals.
Principle 2—Valuing Both Basic and Applied Contributions: Resource allocation within resource constrained environments is at the center of attention of resource holders such as policy makers and accelerators.
Principle 3—Valuing Plurality and Multidisciplinary Collaboration: In studying entrepreneurial resource mobilization, I bring my organizational research training and borrow from the literature and methodologies of development economics to guide my theoretical thinking and research design.
Principle 4—Sound Methodology: This research is based on a randomized field experiment. For more details, the pre-registration ID for this experiment is RCT ID AEARCTR-0005305.
Principle 5—Stakeholder Involvement: Working closely with the host organization and being in the field during the design and implementation is key driver for the success of this experiment.
Principle 6—Impact on Stakeholders: This research helps entrepreneurial resource holders (induvial and institutional) understand how to optimally allocate their resources to disadvantaged entrepreneurs.
Principle 7—Broad Dissemination: I plan to share the results of this research with scholars as well as practitioners through academic papers, conferences, blog posts, and white papers.