Escaping the Founder Identity Trap: A Process View on Business Model Design during New Venture Creation

We advance theory of how founder identity affects business model design during new venture creation and contribute to the cognitive perspective on business models. We look at business model design as a longitudinal process involving a variety of cognitive work that is co-shaped by the founder identity work. Based on an in-depth nine-year process study of a single venture managed by three founders, we observed that a novelty-centered business model design resulted from cognitive work co-shaped by founder identity construction and verification processes. Yet, more remarkably, we noted that founder identity verification decreased over time and observed a process that we labelled “identity-business model decoupling”. It meant that the founders did not alter their founder identity but, over time, attentively grew self-aware and mindfully disengaged negative identity effects to design an effective business model. Our results provide a dynamic view on founder identity imprinting on ventures’ business models, and contribute to the identity, business model, and entrepreneurship literatures