A Model of Venture Creation in New Industries

Pieter A. VanderWerf

Entrepreneurship Theory and Practice, 1993, vol. 17, issue 2, 39-47

Abstract: The peculiarities of new industries make them particularly favorable to the creation of new ventures. The ventures arise from among those parties that have access to Information about the new product, a community that expands over time. But certain activities of the creation process—especially Information gathering and fundraising—stop many ventures from continuing. Moreover, these constrictions In the process are Influenced by past levels of success of the process Itself. This sets up feedback mechanisms that regulate creation rates In various patterns, but eventually lower them to near zero, completing the familiar cycle of new industry entries.

Date: 1993
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Persistent link: https://EconPapers.repec.org/RePEc:sae:entthe:v:17:y:1993:i:2:p:39-47

DOI: 10.1177/104225879301700204

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