A Study On The Crossing Mechanism Of Legitimacy Thresholds Of New Ventures Based On Event System Theory

Many web startups have emerged and associated with high mortality,since the policy of "Mass entrepreneurship and innovation" was put forward.Researchers suggest that legitimacy threshold is the key factor lead to the high mortality of new ventures.A venture is expected to fail below the legitimacy threshold,and is able garner resources needed for survival and growth.Most new ventures lack operating histories to garner endorsements from legitimacy valuators in comparison with mature enterprises.In the process of legitimization,new ventures need to promote the legitimacy by acquiring more acceptance among valuators.The criteria for assessing new venture legitimacy vary across different development phases as venture garner resource from different legitimacy valuators.As a consequence,new ventures confront multiple legitimacy thresholds as they evolve and grow.But most extant research only discuss the "multiple legitimacy thresholds" from the theoretical level,and there lacks empirical research.Thus,this study,based on the qualitative research framework of event system theory,selected Didi Chuxing and OFO as the research subject,to study the process of crossing the legitimacy threshold of new ventures from the perspective of event strength,event time and event space.On this foundation,this paper analyzed the difference of key events on legitimacy.This paper has the following results:1.There are cognitive legitimacy threshold,regulative legitimacy threshold and normative legitimacy threshold during the process of new ventures ' legitimation.2.The key events that trigger the cognitive legitimacy threshold originate at the organizational level;the key events that trigger the regulative legitimacy threshold originate at the environment level;the key events that trigger the normative legitimacy threshold originate at the industry or individual level.3.The higher level of the event's origin,the greater its spatial diffusion,the longer it lasts,and the greater the impact on the legitimacy of new ventures.This paper summarized the following theoretical contributions:1.It expands the dynamic study of the legitimacy of new ventures.The influence of environment,industry and individual factors to legitimacy are discussed by combining the dimensions of time and space,to study the cross-layer dynamics of the accumulation process of the legitimacy of new enterprises.2.It expands the research of multiple legitimacy thresholds and provides practical cases to support the existing views.3.It expands the application of event system theory.For the first time,event system theory is introduced into the research on the legitimacy of new ventures,and it provides a reference for the follow-up researchers to use event system theory.Meanwhile,our study also provides a reference model for new venture committed to the innovation of sharing economy,and it also provides an effective basis for the management of key events with significant on enterprise development,and it provides a theoretical basis for the government to formulate more rational industry policy.