How Entrepreneurs Experiment: Balancing Rapid Action and Thoughtful Reflection

What is it about?

Being experimental, as in acting rapidly through agile iterations, is commonly described as a key factor for successful entrepreneurship. This view of experimentation contrasts with evidence that suggests that entrepreneurs who carefully consider and test their theories (or assumptions) achieve better performance. This review rewires the concept of experimentation by examining the new venture creation process, clarifying the contrasting views on what entrepreneurial experimentation entails and how it is operated in practice.

Featured Image

Photo by Adam Bezer on Unsplash

Photo by Adam Bezer on Unsplash

Why is it important?

This article is critical because it reconciles the fundamental contradiction in entrepreneurship research between experimentation viewed as rapid, iterative action and as theory-driven reflection. By synthesizing 30 years of literature, the work introduces a unique "functional lens" that categorizes experimentation into two distinct purposes: "discovery" (validating value in predictive, well-defined spaces) and "making" (generative shaping of the environment under high uncertainty). This approach is unique because it moves beyond methodological disputes to demonstrate how both functions jointly shape entrepreneurial outcomes and strategic choices across the entire venture creation lifecycle. The work is exceptionally timely due to the surging academic and practical interest in experimentation, fueled by the popular lean startup movement and the emerging scientific method in entrepreneurship. Current high-quality journals are locked in an active debate regarding whether there is a "right" or "wrong" way to experiment, especially as recent evidence has identified substantial performance differences linked to these different methods. By overlaying these experimental functions onto the initiating, engaging, and performing phases of a new venture, this research provides a necessary framework to explain these performance disparities and offers a structured agenda to guide future research and practice.