Intermediated Legitimation: How Founders Build New Venture Legitimacy among Make-or-Break Audiences

Many new ventures enter relationships with intermediaries, thereby ceding control to an organization that becomes a make-or-break audience for them. These settings foster intense experiences, suggesting that participating founders are likely to face a distinct set of challenges as they seek to build their venture’s legitimacy. Yet we lack a systematic analysis of new venture legitimation processes in the context of this critical audience type. To build new understanding of these important dynamics, we conducted an ethnographic study of three ventures in an Australian accelerator. Our study reveals three distinct legitimation pathways that ventures may follow when seeking legitimacy from a make-or-break audience—the obedient, pragmatic, and rebellious paths. We find that these pathways are jointly shaped by the expectations of the audience, the emotional experiences of founders, and founders’ reactions to these emotions in the context of perceived venture performance. We contribute to organizational scholarship by identifying a novel set of new venture legitimation pathways that incorporate emotion, conceptualizing “venture work” as a distinct type of social-symbolic work designed to legitimate startups and shedding new light on the role of new venture support organizations in entrepreneurial ecosystems.