The Transformation of Embedded Means into Resources During Community-Based Venture Creation

Abstract

In this chapter, we delve into the mechanism that mobilizes embedded means in the process of new venture co-creation in a small community. We build on effectuation theory to explain the ways in which these means—readily available and unique to each individual and to the community as a whole—provide a foundation for the integration of resources. We examine these ideas using rich qualitative data from homestay entrepreneurs in a rural Malaysian community. Our findings reveal how trust transforms embedded means, such as a sense of community and an authentic culture, into resources, in the venture-creation process. We contribute to community-level entrepreneurship research by applying effectuation theory to illustrate the social construction of new ventures at the community level. Effectuation theory enables us to delineate the contextuality of entrepreneurial cognition and actions at this level. We also contribute to effectuation theory by applying it at the community level and extending the key concept of trust as a mechanism that transforms intangible means into new resources in this theory. In addition, we discuss the implications for practitioners and policymakers.