Exploring the dark side of entrepreneurial team diversity: A post-mortem analysis of failed start-ups

This study challenges the predominantly positive view of entrepreneurial team diversity by exploring its negative effects on start-up survival across different development stages. Drawing on secondary data from interviews of failed start-ups retrieved from the Failory database, triangulated with additional publicly available sources of evidence, the research employs an inductive qualitative analysis grounded in the Gioia method and a retrospective approach, to examine which demographic, informational, personality, and cognitive diversity characteristics contribute to failure during the idea, product development, and launch stages. Findings reveal that personality and cognitive diversity are critical in idea development, personality and informational diversity during product development, and personality and demographic diversity during the launch stage. Adopting a dynamic perspective, the study deepens the understanding of team dynamics and venture survival in the entrepreneurial context. The findings guide managers and policymakers on leveraging diversity as a strategic asset while addressing challenges throughout the venture’s lifecycle.