Do the Stories They tell get them the Money They Need? The Role of Entrepreneurial Narratives in Resource Acquisition

Abstract

Adopting a narrative approach to resource acquisition research, we examine the effects of storytelling on a firm's ability to secure capital. We argue that narratives help leverage resources by conveying a comprehensible identity for an entrepreneurial firm, elaborating the logic behind proposed means of exploiting opportunities and embedding entrepreneurial endeavors within broader discourses. Qualitative analyses of all 1996–2000 initial public offering prospectuses in three high-tech industries reveal how identity constructions, story elaboration, and contextual embedding are invoked within narratives. Our quantitative findings show how these aspects of an entrepreneurial narrative impact resource acquisition net of previously emphasized factors.