Category Archives: 2024

Theory, search, and learning

Olav Sorenson

When searching for a solution to a problem, having a theory—an underlying causal structure that explains outcomes as a consequence of antecedents and that allows for the prediction of potential consequences of combinations of choices not yet tried—changes the way in which people explore the solution space. Whether a theory proves useful to search, however, depends not just on its predictive precision. This essay argues that the internal structures of theories—their size, complexity, the extent of their elaboration, and the confidence that their users have in the assumptions—also influences how people search for solutions and the efficiency of their search processes. It offers several conjectures about how theory and theory structure influence search and about which types of theories prove most useful to success.

Strategy Science, 9(4): 372-381 (OPEN ACCESS)

The sociology of entrepreneurship revisited

Tristan L. Botelho, Ranjay Gulati, and Olav Sorenson

Over the last two decades, the sociology of entrepreneurship has exploded as an area of academic inquiry. Most of this research has been focused on understanding the environmental conditions that promote entrepreneurship and processes related to the initial formation of an organization. Despite this surge in activity, many important questions remain open. Only more recently have scholars begun to turn their attention to what happens to organizations, and the people connected to them, as they mature and move through the life cycle of entrepreneurship. These open questions, moreover, connect to many classic themes in the literature on careers, organizational sociology, stratification, and work and occupations. Using a framework that focuses on three phases of the entrepreneurial life cycle—pre-entry, entry, and post-entry—we summarize sociological research on entrepreneurship and highlight opportunities for future research.

Annual Review of Sociology, 50: 341-364 (OPEN ACCESS)

The new Argonauts: The international migration of venture-backed companies

Yuan Shi, Olav Sorenson, and David M. Waguespack

We use a novel longitudinal dataset, constructed from 16 downloads of VentureXpert records collected over 20 years, to characterize the international migration of venture-capital-backed startups. We find that: (i) 1078 firms in our sample (1.4%) migrate; (ii) countries with high levels of in-migration also have high levels of out-migration; (iii) migrating firms move to places with more investors; (iv) pre-move investors and their connections most strongly predict migration patterns; and (v) movers raise more money than non-movers, primarily from investors at their destinations. Overall, these patterns appear inconsistent with those expected if startups move primarily in search of talent or customers. Instead, the flows across countries look more like international trade, with startups seeking capital, and social connections between investors defining the shipping lanes.

Strategic Management Journal, 45: 1485-1509 (OPEN ACCESS)

Summarized in the UCLA Anderson Review

The shape and structure of entrepreneurial and innovative places

Geoffrey Borchhardt and Olav Sorenson

Interactions primarily occur between those living and working in close proximity to one another. This essay explores some consequences of that fact for places. It offers three principle propositions: (1) Compact buildings, neighborhoods, and cities, and denser places, should promote higher rates of entrepreneurship, innovation, and economic growth because they reduce the costs of interaction. (2) More integrated places should also promote entrepreneurship and innovation because the average person in those places interacts with a more diverse set of others. (3) In more segregated and unevenly distributed places, people diverge more, as a function of where within the place they live and work, in their propensities to innovate and to found firms.

Published in Entrepreneurial Ecosystems in Cities & Regions

Preprint available