Living Up to the Hype: How New Ventures Manage the Resource and Liability of Future-Oriented Visions within the Nascent Market of Impact Investing

Abstract

Hype is a collective vision and promise of a possible future, around which attention, excitement, and expectations increase over time. Within nascent markets, hype can thus serve as a cultural resource by which entrepreneurs might encourage greater early stakeholder support and resources. And yet as hype-driven support couples with mounting temporal and categorical expectations, this can also limit ventures' flexibility during the entrepreneurial process. Drawing on an inductive, longitudinal, and comparative study of three new ventures within the muchhyped nascent market of impact investing, we develop an emergent theory of hype management, illustrating the field organizing practices that give rise to different forms of social proof, thereby allowing new ventures sufficient flexibility to convert hype into a sustained entrepreneurial opportunity. Our account contributes directly to contemporary public conversations of hype by revealing how entrepreneurs might engage with and indeed live up to the hype surrounding nascent markets without succumbing to the deceit and disappointment typically associated with hype. Beyond this, our findings extend existing scholarship on entrepreneurship within nascent markets, the sociology of expectations, and the realization of distant futures.

From Nirvana to Shiva in Impact Investing: Value (In)congruence in Investor–Investee Relationships

“…First, this article contributes to the impact investing literature by deepening our understanding of values and value (in)congruence in investor–investee relationships. We show that value (in)congruence is critical to individuals in impact investing ecosystems, where relationships require shared goals (Logue & Grimes, 2022). Although previous studies acknowledged the role of values due to associated expectations (Agrawal & Hockerts, 2019; Kish & Fairbairn, 2017; Logue & Grimes, 2022), we address the existing gap in the literature which overlooked the role of value (in)congruence in this field.…”

“…We show that value (in)congruence is critical to individuals in impact investing ecosystems, where relationships require shared goals (Logue & Grimes, 2022). Although previous studies acknowledged the role of values due to associated expectations (Agrawal & Hockerts, 2019; Kish & Fairbairn, 2017; Logue & Grimes, 2022), we address the existing gap in the literature which overlooked the role of value (in)congruence in this field. Specifically, there is scarce literature on incongruence leading to conflicts between investors and investees, which we illustrate via the Shiva dyads.…”

“…Impact investing is seen as a value-based activity that generates financial returns while intentionally addressing social and environmental challenges (Kish & Fairbairn, 2017; Logue & Grimes, 2022). The focus on the dual goals in impact investing differentiates it from traditional profit-seeking investing (Agrawal & Hockerts, 2019; Lehner et al, 2019).…”

After successful fundraising: how overfunding and category spanning affect the release and audience-perceived quality of crowdfunded products

“…This effect is fostered by the highly visible nature of overfunded projects, which are frequently discussed in social media, online communities, the public press, and other outlets. The more (over-) funded they are, the more likely they generate discussion, long before an actual product is released (Logue & Grimes, 2022;Scheaf et al, 2018). With increasingly high levels of attention, the heterogeneity of audiences and expectations is also likely to increase (Stevenson et al, 2019).…”

“…Furthermore, we controlled for time to market, which is the number of days between the game's successful funding on Kickstarter and its release, as games with substantial overfunding may take longer to develop (Mollick, 2014), and audience expectations of product quality may be higher for games that take longer to develop. Finally, we accounted for the peak number of players because "hype" games are likely to receive higher levels of overfunding but may also receive more scrutiny from players (Logue & Grimes, 2022), which could affect the relation between overfunding and audience-perceived product quality.…”