New venture legitimacy diffusion beyond the local entrepreneurial ecosystem : the transformative role of brokerage and network activities

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Authors

Kansheba, Jonathan Mukiza
Fubah, Clavis Nwehfor
Wald, Andreas

Journal Title

Journal ISSN

Volume Title

Publisher

Emerald

Abstract

PURPOSE : New ventures often encounter legitimation challenges due to their liability of newness and foreignness. This particularly applies to the legitimacy beyond the local entrepreneurial ecosystem (EE). The present study examines how new ventures’ local legitimacy influences legitimacy diffusion beyond the local EEs. It considers both the direct relationship between new venture local legitimacy and its diffusion beyond the EE and the moderating effects of legitimacy brokerage and network activities on this relationship. DESIGN/METHODOLOGY/APPROACH : A hierarchical multiple linear regression is employed to test a series of hypotheses using the data of 228 Finnish firms which was collected with an online survey. FINDINGS : Firms that garner active local legitimacy have a greater chance to diffuse that legitimacy beyond an existing ecosystem. Results also reveal that network activities and legitimacy brokerage enhance (positively moderate) the association between (passive and active) local legitimacy and its diffusion. ORIGINALITY/VALUE : The present study contributes to and extends the literature at the intersection of new venture legitimacy and legitimacy diffusion beyond the existing EE – an aspect which has not been sufficiently studied.

Description

Keywords

Entrepreneurial ecosystems, Legitimacy, Passive validation, Active validation, Network activities, Brokage, SDG-08: Decent work and economic growth

Sustainable Development Goals

SDG-08:Decent work and economic growth

Citation

Kansheba, J.M., Fubah, C.N. and Wald, A. (2024), "New venture legitimacy diffusion beyond the local entrepreneurial ecosystem: the transformative role of brokerage and network activities", International Journal of Entrepreneurial Behavior & Research, Vol. 30 No. 11, pp. 164-180. https://doi.org/10.1108/IJEBR-08-2023-0867.