Reveal or Conceal? An Explorative Study of Signaling Strategies to Build Legitimacy in Cleantech Ventures

Ekaterina Bjørnåli, Ferran Giones, Anders Billström

Publikation: Konferencebidrag uden forlag/tidsskriftKonferenceabstrakt til konferenceForskningpeer review


The emergence of cleantech industry offers a unique context to explore and develop
entrepreneurship theories. Cleantech ventures are important agents of environmental innovation,
they exploit technological knowledge contribute to an increased use of energy from renewable
sources or to a more environmentally friendly handling of waste. They represent an extreme case of
technology entrepreneurship: combining a strong focus on capital-intensive technologies with
complex industrial markets.
Cleantech ventures face greater firm and industry-level legitimacy challenges while accessing
external resources, compared to high-tech ventures operating in more established (legitimized)
industries. Zimmermann and Zeitz (2002) suggested that achieving a legitimacy threshold is related
to the emergence of a new venture. However, from the stage-based theory perspective, gaining
legitimacy is associated with overcoming critical junctures (Vohora et al. 2004). Instead of a unique
threshold, cleantech ventures might have to build and sustain legitimacy across different stages,
overcoming legitimacy thresholds (Fisher et al. 2016). Our study examines how cleantech ventures
pursue the process of signaling towards external parties to reach important entrepreneurial
milestones in different development stages. We address the following research questions: • Why
and how do the cleantech ventures signal to gain legitimacy, and • What signals do they send in the
start-up and growth (late) stages?
We use a multiple case-study of five cleantech firms. The selected companies started in Norway,
but operate internationally, as evidence of the global nature of this emerging industry. We have
carried out personal in-depth interviews with the CEOs of the five ventures (signal senders) using a
semi-structured interview guide in the spring 2016, and collected secondary data on the firms.
Results and Implications
Our findings describe the motivations and distinctive characteristics of the signaling actions.
Cleantech ventures pursue several parallel signaling strategies, shifting from resources to customers’
acquisition. Furthermore, as cleantech ventures issue multiple signals to external parties
simultaneously, consistency and complementarity between the signals amplifies the positive effect
on the firm’s legitimacy. We identify direct signals that reveal qualities of the firm, and derivative
signals that help to conceal perceived weaknesses. For cleantech entrepreneurs, having a focus on
direct signaling on how the technology performs and its market potential seems to be a more fruitful
strategy than signaling the environmental impact of technology in the early stage. While having an
experienced board helps to issue derivative signals to conceal the limited reputation of the founding
Publikationsdato9. jun. 2017
StatusUdgivet - 9. jun. 2017
Begivenhed2017 Babson College Entrepreneurship Research Conference - The University of Oklahoma Michael F. Price College of Business, Norman, USA
Varighed: 7. jun. 201710. jun. 2017


Konference2017 Babson College Entrepreneurship Research Conference
LokationThe University of Oklahoma Michael F. Price College of Business


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