Too much of two good things: The curvilinear effects of self-efficacy and market validation in new ventures

Xi Chen and Stephen X. Zhang

Journal of Business Research, 2024, vol. 183, issue C

Abstract: Interacting with customers to validate new product offerings is a crucial step in entrepreneurship, yet it requires resources that are limitedin new ventures. The issue of when and how entrepreneurs allocate limited resources to acquire market information is new for marketing research, which has mainly focused on the impacts of market information acquisition. This paper investigates how entrepreneurs’ self-efficacy influences resource allocation to acquire market information and how resources allocated to market information acquisition influence new venture performance. Building on social cognitive theory and perceptual control theory, we propose that entrepreneurs with moderate marketing self-efficacy spend the most resources on market information acquisition. Since acquiring market informationconsumes resources, we hypothesize that a moderate level of market information acquisitionis optimal for new venture performance. Regression analyses of a multi-informant three-wave survey with 210 new ventures from Canada, Chile, and China supported our hypotheses. The findings hold important implications forself-efficacy theories, information acquisition research, and lean startup.

Keywords: Information acquisition; Market validation; Resource allocation; Self-efficacy; Entrepreneurial self-efficacy; Feedback seeking; Lean startup (search for similar items in EconPapers)
Date: 2024
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jbrese:v:183:y:2024:i:c:s0148296324003497

DOI: 10.1016/j.jbusres.2024.114845

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