Gestation in new technology ventures: Causal brakes and effectual pedals

ABSTRACT

Gestation speed has long been acknowledged as an important proximate measure of venture performance. Yet, research into its antecedents remains scarce. Through a longitudinal study of eight new technology ventures, we examine in-depth the relationships between the use of causal and effectual logics and gestation speed. Our data show that heuristics from both logics can act as pedals or brakes on gestation speed. However, we also find that nascent entrepreneurs who apply effectuation as their predominant decision-making logic gestate more quickly than their peers. The inductive model we develop from the findings offers nine mechanisms relating decision heuristics to proximate performance. Additional longitudinal data provide evidence for a positive relationship between higher gestation speed and the probability of long-term success.

KEYWORDS:

• Nascent entrepreneurship
• gestation
• speed
• early stage
• effectuation

Acknowledgments

We thank the editor and two anonymous reviewers for their challenging and constructive engagement with this paper, as well as the many colleagues who have provided valuable feedback in the process.

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

¹ Note: The number behind the venture project indicates the person who was interviewed. We also provide the decision-making heuristic by which the quote was coded (see Table 2 for an overview of heuristics).