The impact of pre-startup planning on the strength of planning assumptions and the mode of processing

While many researches have argued that founders should apply a continuous planning and learning approach, no one has examined the consequences of pre-startup planning on the dynamic capabilities to do so. In this study, we analyse if pre-startup planning has a negative impact on the cognitive dynamic capabilities of the founder. Using cross-sectional data from 102 nascent entrepreneurs, we examine the strength of planning assumptions and its impact on the information-processing mode of the founder. The results show that pre-startup planning progress correlates with both accessibility and knowledge of planning assumptions, which in turn increases the certainty by which founders hold their planning assumptions. Findings further indicate that higher certainty and knowledge of planning assumptions foster the achievement of the sufficiency threshold, indicating that founders maintain their planning assumptions with enough confidence to guide heuristic decision-making during the founding stage. These results imply that pre-startup planning affects the cognitive dynamic capabilities of the founder because strong planning assumptions influence their perceptions and prevent them from systematic information-processing and unbiased decision-making.