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Why are intentions interesting to those who care about new venture formation? Entrepreneurship is a way of thinking, a way of thinking that emphasizes opportunities over threats. The opportunity identification process is clearly an intentional process, and, therefore, entrepreneurial intentions clearly merit our attention. Equally important, they offer a means to better explain—and predict—entrepreneurship. We don't start a business as a reflex, do we? We may respond to the conditions around us, such as an intriguing market niche, by starting a new venture. Yet, we think about it first; we process the cues from the environment around us and set about constructing the perceived opportunity into a viable business proposition. In the psychological literature, intentions have proven the best predictor of planned behavior, particularly when that behavior is rare, hard to observe, or involves unpredictable time lags. New businesses emerge over time and involve considerable planning. Thus, entrepreneurship is exactly the type of planned behavior Bird 1988 and Katz and Gartner 1988 for which intention models are ideally suited. If intention models prove useful in understanding business venture formation intentions, they offer a coherent, parsimonious, highly-generalizable, and robust theoretical framework for understanding and prediction. Empirically, we have learned that situational (for example, employment status or informational cues) or individual (for example, demographic characteristics or personality traits) variables are poor predictors. That is, predicting entrepreneurial activities by modeling only situational or personal factors usually resulted in disappointingly small explanatory power and even smaller predictive validity. Intentions models offer us a significant opportunity to increase our ability to understand and predict entrepreneurial activity. The current study compares two intention-based models in terms of their ability to predict entrepreneurial intentions: Ajzen's theory of planned behavior (TPB) and Shapero's model of the entrepreneurial event (SEE). Ajzen argues that intentions in general depend on perceptions of personal attractiveness, social norms, and feasibility. Shapero argues that entrepreneurial intentions depend on perceptions of personal desirability, feasibility, and propensity to act. We employed a competing models approach, comparing regression analyses results for the two models. We tested for overall statistical fit and how well the results supported each component of the models. The sample consisted of student subjects facing imminent career decisions. Results offered strong statistical support for both models. (1) Intentions are the single best predictor of any planned behavior, including entrepreneurship. Understanding the antecedents of intentions increases our understanding of the intended behavior. Attitudes influence behavior by their impact on intentions. Intentions and attitudes depend on the situation and person. Accordingly, intentions models will predict behavior better than either individual (for example, personality) or situational (for example, employment status) variables. Predictive power is critical to better post hoc explanations of entrepreneurial behavior; intentions models provide superior predictive validity. (2) Personal and situational variables typically have an indirect influence on entrepreneurship through influencing key attitudes and general motivation to act. For instance, role models will affect entrepreneurial intentions only if they change attitudes and beliefs such as perceived self-efficacy. Intention-based models describe how exogenous influences (for eample, perceptions of resource availability) change intentions and, ultimately, venture creation. (3) The versatility and robustness of intention models support the broader use of comprehensive, theory-driven, testable process models in entrepreneurship research (MacMillan and Katz 1992). Intentional behavior helps explain and model why many entrepreneurs decide to start a business long before they scan for opportunities. Understanding intentions helps researchers and theoreticians to understand related phenomena. These include: what triggers opportunity scanning, the sources of ideas for a business venture, and how the venture ultimately becomes a reality. Intention models can describe how entrepreneurial training molds intentions in subsequent venture creation (for example, how does training in business plan writing change attitudes and intentions?). Past research has extensively explored aspects of new venture plans once written. Intentionality argues instead that we study the planning process itself for determinants of venturing behavior. We can apply intentions models to other strategic decisions such as the decision to grow or exit a business. Researchers can model the intentions of critical stakeholders in the venture, such as venture capitalists' intentions toward investing in a given company. Finally, management researchers can explore the overlaps between venture formation intentions and venture opportunity identification. Entrepreneurs themselves (and those who teach and train them) should benefit from a better understanding of their own motives. The lens provided by intentions affords them the opportunity to understand why they made certain choices in their vision of the new venture. Intentions-based models provide practical insight to any planned behavior. This allows us to better encourage the identification of personally-viable, personally-credible opportunities. Teachers, consultants, advisors, and entrepreneurs should benefit from a better general understanding of how intentions are formed, as well as a specific understanding of how founders' beliefs, perceptions, and motives coalesce into the intent to start a business. This understanding offers sizable diagnostic power, thus entrepreneurship educators can use this model to better understand the motivations and intentions of students and trainees and to help students and trainees understand their own motivations and intentions. Carefully targeted training becomes possible. For example, ethnic and gender differences in career choice are largely explained by self-efficacy differences. Applied work in psychology and sociology tells us that we already know how to remediate self-efficacy differences. Raising entrepreneurial efficacies will raise perceptions of venture feasibility, thus increasing the perception of opportunity. Economic and community development hinges not on chasing smokestacks, but on growing new businesses. To encourage economic development in the form of new enterprises we must first increase perceptions of feasibility and desirability. Policy initiatives will increase business formations if those initiatives positively influence attitudes and thus influence intentions. The growing trends of downsizing and outsourcing make this more than a sterile academic exercise. Even if we successfully increase the quantity and quality of potential entrepreneurs, we must also promote such perceptions among critical stakeholders including suppliers, financiers, neighbors, government officials, and the larger community. The findings of this study argue that promoting entrepreneurial intentions by promoting public perceptions of feasibility and desirability is not just desirable; promoting entrepreneurial intentions is also thoroughly feasible.

The failure of situational and personality measures to significantly predict entrepreneurial activity suggests another approach. In this study, we compare the predictive ability of two intentions models. One was developed and well validated in social psychology (Azjen's 1991 Theory of Planned Behavior). The other was proposed, but not well tested from the domain of entrepreneurship research (Shapero's 1982 model of the `Entrepreneurial Event'). The comparison will examine the efficacy of these models as they try to predict the intentions that a sample of soon-to-graduate undergraduate business students hold towards starting a new business. Before we consider the past uses of intention models and describe their application in the current work, we begin with an examination of the issue of the degree to which entrepreneurship is planned, and therefore, intentional behavior. 1.1. Entrepreneurship as Intentional, Planned Behavior Although it is possible that some will argue otherwise, it seems evident that much of what we consider `entrepreneurial' activity is intentionally planned behavior. Witness the tremendous emphasis on the business plan in virtually every academic and practical treatment on starting a new business. Even in cases where a unique catalyzing event like being downsized may spur the individual to the entrepreneurial act, there are often indications of a long time interest and desire to be in business for one's self. As new organizations emerge over time, pre-organizational phenomena such as deciding to initiate an entrepreneurial career are both important and interesting Bird 1988 and Katz and Gartner 1988. We thus might conclude that intentionality is typical of emerging organizations, although the timing of the launch of the new venture might be relatively unplanned, such as when a sudden new opportunity surfaces. We best predict, rather than explain, any planned behavior by observing intentions toward that behavior—not by attitudes, beliefs, personality, or mere demographics. Intentions are the single best predictor of planned behavior (Bagozzi et al. 1989). Understanding intentions thus proves particularly valuable where the focal phenomenon is rare, obscure, or involves unpredictable time lags—a focal phenomenon such as entrepreneurship (MacMillan and Katz 1992). In its simplest form, intentions predict behavior, while in turn, certain specific attitudes predict intention. Intentions thus serve as a conduit to better understanding the act itself Ajzen 1987 and Ajzen 1991. As such, intentions serve as important mediating variables between the act of starting a business venture and potential exogenous influences. Intentions toward behavior are absolutely critical to understanding other antecedents. These include situational role beliefs, subsequent moderators, including the perceived availability of critical resources, and the final consequences, including the initiation of a new venture (or lack thereof). Understand the consequences of intentions—particularly actions—requires that we understand the antecedents of intention. Much of entrepreneurship is intentional, and, therefore, the use of well thought-out and research-tested intention models should provide a good means of examining the precursors to business start-up. 1.2. Implications of Entrepreneurial Intentionality Recognizing that starting a business is an intentional act holds substantial implications for research. If stimulus-response models cannot model intentional behaviors fully, then we need testable, theory-driven process models of entrepreneurial cognitions that focus on intentions and their perceptual bases Bird 1988, Katz and Gartner 1988 and Shaver and Scott 1992. When behavior is rare or difficult to observe (Ajzen 1991), intentions offer critical insights into underlying processes such as opportunity recognition. Empirically, behavior is often only weakly predicted by attitudes alone or by exogenous factors that are either situational (for example, employment status or informational cues) or individual (for example, demographic characteristics or personality traits). That is, as a result, predicting entrepreneurial activities by modeling only exogenous factors often results in disappointingly small explanatory power. Remember, exogenous influences usually affect intentions and behavior only indirectly, through attitude changes (Ajzen 1991). Thus, intentions models offer an opportunity to increase our ability to explain—and predict—entrepreneurial activity. Forces acting upon a potential behavior do so indirectly by influencing intentions via certain key attitudes. Exogenous variables influence attitudes and may also moderate the relationship between intentions and behavior. For example, exogenous factors may serve to inhibit one from realizing the intent to be an entrepreneur. Intentions and their underlying attitudes are perception-based, which should mean they are learned. Accordingly, they will vary across individuals and across situations. Exogenous person or situation variables have a more indirect influence and thus are only weakly predictive of entrepreneurial activity. The predictive power of intentions is even stronger for more molar behavior chains, capturing long-run tendencies by canceling variations in situations over time. For instance, the intent to attend church predicts annual attendance much better than intent predicts attendance in any one week that may be affected by extreme situational factors like fires, floods, or even a stalled car (Epstein 1979). Intentions are also an unbiased predictor of action (Bagozzi et al. 1989), even where time lags exist. Thus, a strong intention to start a business should result in an eventual attempt, even if immediate circumstances such as marriage, child bearing, finishing school, a lucrative or rewarding job, or earthquakes may dictate a long delay. Accordingly, the relatively molar domain of entrepreneurship should be quite amenable to the successful use of intentions-based models. Intentions may explain why it appears easier to identify chronic entrepreneurs, those who create several new ventures in a lifetime. 1.3. Evidence for Entrepreneurial Intentionality: Ring a Bell, Start a Business? In general, much of human behavior is planned; it is difficult to envision starting a business where the nascent firm is launched simply as a conditioned response to a stimulus. Specifically, it is equally difficult not to view starting a business as a career choice. A reasonable body of past research supports the contention that career decisions are clearly planned in nature, not responses to stimuli, thus reflecting some degree of cognitive processing. If entrepreneurship does reflect planned, and therefore, intentional behavior, we should see evidence from other research. Thus, we also examine role model studies as well as studies of nascent or beginning entrepreneurs. 1.3. Careers Research Career choices and related phenomena have been demonstrated, both theoretically and empirically, to be cognitive in nature. That is, career-related decisions reflect a process in which beliefs, attitudes, and intentions evolve as we cognitively process our knowledge, beliefs, and experiences (Lent et al. 1994). Prior research suggests that entrepreneurial careers fit this pattern Davidsson 1991 and Katz 1992. 1.3. Role Model Research Evidence from entrepreneurial role models supports the potential of intentions models for predicting new venture creation. Intentions explain conflicts in research findings such as the effects of role models and mentors on eliciting subsequent entrepreneurial behaviors. Entrepreneurial role models only weakly predict future entrepreneurial activity Carsrud et al. 1987 and Scott and Twomey 1988. Instead, the subjective impact of role models is a stronger predictor. That is, role models affect entrepreneurial intentions only if they affect attitudes such as self-efficacy Krueger 1993 and Scherer et al. 1989. 1.3. Research into “Nascent” Entrepreneurs Reynolds and associates are amid a large-scale, long-term project to identify and track “nascent” (newly initiated, but not fully launched) ventures and their founders. Although it is difficult to identify those who have taken some initial steps but have yet to surface in official records, it is believed that “nascent” entrepreneurs are surprisingly numerous. Thus, there is much merit in finding out how to help nascent ventures to avoid being “stillborn” (Reynolds 1994). 1.3. Possible Limitations These arguments strongly support testing intentionality-driven models of entrepreneurship, but few studies do so explicitly. However, not all agree that intentions are ideal. For example, Bagozzi's work showed that intentions fully mediate the impact of attitudes on behavior, yet he himself argues that understanding volition requires more complexity (1993). There is also a well-developed model of predicting entrepreneurship that employs attitudes (Robinson et al. 1991b). This suggests that researchers exercise some caution in applying intentions models.

Past research shows the importance of intentions and the robustness of the known antecedents of intentions, especially where focal phenomena are relatively rare as with entrepreneurship. These findings offer little, if any, contrary evidence. What can we thus conclude from explicit consideration of entrepreneurial intentionality? 11.1. General Implications Intentions consistently and robustly predict planned behaviors. As entrepreneurship is a planned behavior, we should find intentions models quite useful. Understanding the antecedents of intentions implies understanding the behavior. Attitudes influence behavior through effects on intentions. Intentions and attitudes depend on the situation and person. Accordingly, intentions models predict behavior better than either individual (for example, personality) or situational (for example, employment status) variables. Predictive power is critical to better post hoc explanations of entrepreneurial behavior. Intentions models provide superior predictive validity. Personal and situational variables typically have an indirect influence on entrepreneurship by influencing key attitudes and general motivation to act. For instance, role models affect entrepreneurial intentions largely because they affect attitudes and beliefs such as perceived self-efficacy. Intention-based models offer mechanisms to assess relative impacts of exogenous influences (for example, perceptions of resource availability) on intentions and, ultimately, venture creation. The versatility and robustness of intention models support the broader use of theory-driven, comprehensive, testable process models in entrepreneurship research (MacMillan and Katz 1992). For instance, understanding the nature of intentional behavior helps explain why many entrepreneurs decide to start a business long before they scan for opportunities or decide exactly what type of business to start (Brockhaus and Horwitz 1986). The growing interest in entrepreneurs' beliefs and decision-making processes helps us to begin asking what kinds of factors contribute to the decision to become involved in entrepreneurial activity. Intention-based models appear most promising for research and for teaching and practice. 11.2. Research Implications Intentions models offer great utility and considerable potential for entrepreneurship researchers in advancing theory. Using formal intentions models offers the researcher a well-developed theory base used in multiple disciplines and also offers clear, testable hypotheses. Both increase the rigor of research without losing any relevance. This approach and the significant findings add strong evidence for person × situation variables, as opposed to the more usual person variables or situational variables. 11.2. Cognitions are Important The findings here add to existing theory and evidence that argues for the importance of cognitive issues. This tells us that it would be most fruitful to open the cognitive `black box' and try to understand the cognitive processes inside. For example, certain learned attitudes such as self-efficacy are vital. Okay, how do we learn them? We know that skills and skill sets are vital; how do we learn them? And how do we best teach them? For example, the impact of teaching entrepreneurial competencies on perceptions of venture feasibility could be important for specific types of ventures. For example, we can identify more specific task self-efficacies that influence perceptions of feasibility for high technology ventures. 11.2. Business Plans and Planning Research has explored many aspects of new venture plans. Intentionality argues instead that we study the planning process itself. Understanding intentions helps us to better understand where ideas for a business venture come from and how the venture becomes a reality. Research has explored many aspects of new venture plans. Intentionality argues instead for studies on the process of planning: how do new venture plans evolve from an idea to a well-developed business concept Bird 1988 and Katz and Gartner 1988? 11.2. Extending the Domain We can use intentions models to predict other strategic decisions (for example, the decision to grow or exit a business). We can model the intentions of critical stakeholders in the venture, such as venture capitalists' intentions toward investing in a given company. Finally, management researchers can explore significant conceptual overlaps between intentions and opportunity identification. Intentions offer a useful vehicle for gaining new insights into the processes by which we identify opportunities and how we formulate and implement resulting actions. 11.2. Addressing Past Criticisms Methodologically, intentions models address several criticisms often leveled at entrepreneurship research. One significant criticism is emphasizing retrospective and post hoc research methods. Instead of the more prevalent ad hoc models and measures of new venture initiation, critics suggest careful testing of theory-driven models Carsrud et al. 1993 and MacMillan and Katz 1992. Hindsight can be dangerously imperfect for understanding any intentional behavior. We too often accept a spurious relationship based on a biased recall measure or an inappropriately censored sample, then compound the problems by using the unpredictably biased results in an ad hoc model. For instance, we see models based on spurious demographic relationships (Carsrud et al. 1993). The net result is often irreproducible conclusions about the emergence of new businesses. Thus, if organizational emergence is an intentional process Bird 1988 and Katz and Gartner 1988, why not use intentions models? Let us evaluate the entire emergence process including not only successful and unsuccessful entrepreneurs, but also those who change their minds and those whose ventures fail (Reynolds 1992). We can use archival databases to test psychosocial models longitudinally (Katz 1992). 11.2. Exogenous Influences The rewards from using intentions models include a better understanding of how exogenous factors influence the emergence of new ventures. The literature (Shapero 1982) offers an interesting menu of exogenous factors that represent potential testable antecedents of attitudes (for example, traits, demographics, skills, and social, cultural, and financial support). We can test the impact of teaching critical managerial and entrepreneurial competencies on perceptions of venture feasibility, including specific types of ventures. Will perceived self-efficacy at new product development tasks influence the perceived feasibility of high-tech ventures? 11.2. From Intent to Action Katz (1992) and Reynolds (1994) both note the often-significant time lags from intent to action. This argues that studying entrepreneurs should prove useful to a better understanding of how intentions are (or are not ) realized in strategic decision-making and how intentions change. We can use intention-based models on corporate ventures or for other strategic decisions such as the decision to exit or to grow a firm. An especially intriguing possibility is to model the intentions of critical stakeholders in the venture. For example, what are the intentions of venture capitalists toward investing in a given company? Do they perceive their most influential social norms to be within the venture capital community? What specific self-efficacies influence perceptions of a potential investment's feasibility? What about other stakeholders such as bankers, suppliers, and employees? Meyer et al. (1993) have already explored differences in causal attributions between venture capital investors and investees. 11.3. Implications for Management Researchers We see how studying entrepreneurs could be more broadly useful to management research. Studying entrepreneurs already increases our understanding of intentions as Shapero's notions of “displacement” and “propensity to act” already add to our understanding of intention-behavior relationships. Adding volition makes a useful contribution of entrepreneurship research to the study of strategic decision making. Equally important is the significant conceptual overlap between intentions and opportunity identification. Intentions represent a useful vehicle for gaining new insights into the processes by which we identify opportunities and threats and how we formulate and implement resulting action. This extends the impact of intentions models beyond independent new ventures to any arena where opportunity identification is important. Finally, as entrepreneurs are highly visible exemplars of organizational enactment, it should be easier to track the cognitions of founders than to explore more complex organizational mindsets (Guth et al. 1991). 11.4. Implications for Teachers Educators can invoke this model to better understand our students' motivations and intentions, and thus provide better training. As noted earlier, gender and ethnic differences in career choice derive from differences in perceived self-efficacy, differences that we already know how to remedy. For example, we still hear that women entrepreneurs are more prone to open businesses in the retail sector than in manufacturing. This suggests that in our teaching or training we look for differences in perceived desirability and, more likely, perceived feasibility. If a critical deficit lies in perceived feasibility, we know how to increase self-efficacy perceptions. However, the intentions model is what gave us the diagnosis. This diagnostic strength allows educators a different way of looking at most case studies. Consider the case of Dorsey Trailers, a fascinating entrepreneurial buyout of a truck trailer manufacturer (Lane 1995). Entrepreneur Marilyn Marks not only bootstrapped the buyout but has weathered (literally) both Hurricane Opal and a flood. Usually, most attention is paid to her being a nontraditional entrepreneur (a young woman in the Southern U.S. building truck trailers?) or the recovery from two weather disasters. However, one can also examine Marks's strategies through the lens of intentionality. That is, the specific innovative strategies chosen seem to clearly reflect courses of action that Marks deemed desirable and feasible—or that could be made feasible. 11.5. Implications for Practitioners Intentions-based models yield useful practical applications whenever behavior is intentional. Consultants, advisors, and the entrepreneurs themselves will all benefit from a better understanding of how intentions are formed and how founders' beliefs, perceptions, and motives coalesce into the intent to start a business. The entrepreneurs themselves should gain considerable value from a better understanding of their own motives. The lens provided by intentions affords them the opportunity to understand why they made certain choices in their vision of the new venture. It is useful to recognize how we differ across types of business in our perceptions of desirability and feasibility. 11.6. Implications for Public Policy Policy makers benefit from understanding that government initiatives will affect business formations only if these policies are perceived in a way that influences attitudes or intentions. Two growing societal trends make all this more than a sterile academic exercise. Downsizing and outsourcing currently dominate much of the U.S. corporate landscape. Recognition is growing among policy-makers that economic and community development hinges not on smokestack-chasing, but on growing your own businesses. If we seek to encourage economic and community development by promoting new enterprises, we need a much better understanding of the process. Robust empirical support for both models argues that promoting entrepreneurial intentions requires promoting perceptions of both feasibility and desirability. Even if we increase the quantity and quality of potential entrepreneurs, we must also increase the credibility of entrepreneurship among critical stakeholders in the community. Government officials, politicians, suppliers, investors, bankers, friends and neighbors, and the larger community must also see entrepreneurial activity as desirable and feasible (Shapero 1982). We must also make certain that we include all strata of society (Hood and Young 1993). Ethnic and gender differences in career choice may derive from self-efficacy differences, but we know how to remediate such differences. Finally, this should all be done with an eye toward encouraging already-launched businesses. Reynolds eloquently points out that “stillborn” ventures contribute little to a local community, thus we must empower already-nascent entrepreneurs (Reynolds 1994).