Publication: What Goes Up, Must Come Down: An Exploration of Hype in Entrepreneurship and New-Venture Finance
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2025
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IE University
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This dissertation advances scholarship on entrepreneurial hype by offering a comprehensive analysis of its origins, mechanisms, and consequences across entrepreneurial ventures, venture capital markets, and investor decision-making. Drawing on interdisciplinary insights from entrepreneurship, sociology of expectations, and behavioral finance, the research comprises three interconnected studies that collectively unpack the nuanced dynamics underlying hype phenomena. The first study synthesizes existing literature from entrepreneurship and innovation studies to conceptualize hype as an expectation-driven process manifesting at venture, industry, and market levels. It identifies hype as both a strategic tool entrepreneurs deploy to secure resources and legitimacy, and as a broader market-level dynamic influencing industry trajectories and capital flows. The second study empirically investigates the highly financialized, disruption-oriented, and fast-growing entrepreneurial model that has has become the center of attention for scholars and the public, and its financial cornerstone, venture capital, positioning them as socio-technical systemts subject to hype cycles. Through qualitative analysis of public discourse over two decades, it reveals the instability and contestation underlying what is typically perceived as a dominant entrepreneurial paradigm, contributing to debates around sustainability and ethical challenges inherent to this approach to entrepreneurship. The third study employs experimental methods to examine how counterfactual emotions, particularly fear of errors of commission (investing incorrectly) and omission (missed opportunities), influence early-stage investment decisions. Findings reveal that potential regret associated with commission errors significantly curtails investor willingness to commit capital, illuminating how emotional and social dynamics critically shape investor behavior under conditions of uncertainty. Together, these chapters provide novel theoretical and practical insights, emphasizing the interplay between entrepreneurial narratives, investor cognition, and socio-economic environments. The dissertation not only deepens the understanding of entrepreneurial hype but also informs stakeholders on navigating the delicate balance between leveraging and mitigating hype within contemporary entrepreneurial ecosystems.
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Attribution-NonCommercial 4.0 International
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IE Business School
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Boada Rodríguez, E. A. (2025) What Goes Up, Must Come Down: An Exploration of Hype in Entrepreneurship and New-Venture Finance. (Tesis doctoral).