Why Do Some Entrepreneurs Act on Opportunities Outside their Domain Knowledge?

This research aims to explain why some entrepreneurs decide to exploit opportunities in their familiar fields but some choose distant opportunities. We investigate the nature of attention- driving factors and their impacts on entrepreneurial decision making. Also, we compare the cognitive processes of opportunity recognition and evaluation driven by three cognitive factors (technology-driven, operation-driven, and use-driven) to show how these factors lead to different cognitive processes and eventually influence the decisions of opportunity selection. Our study especially investigates the role of emotional feelings (e.g., frustration, dissatisfaction) in influencing founding teams’ cognitive processes and shows that emotional feelings direct use- driven founding teams’ attention to particular signals resulted from the problems they care. The cognitive process of use-driven founding teams is, thus, different from that of technology-driven and market-driven teams which is based on founding teams’ prior knowledge structures to interpret what can be done. Use-driven teams concentrate on interpreting a solution to solve a particular problem. Once they come up with an idea for particular problem solving, they almost simultaneously decide to exploit the opportunity. Thus, they tend to simplify the process of opportunity evaluation and mostly base on their entrepreneurial imagination regarding technology and market feasibility.