Abstract

In this paper, we examine how deception can persist within entrepreneurial firms. We conducted separate, longitudinal ethnographic studies of two promising start-ups founded to solve intractable problems. While we did not set out to study deception, deception is what we observed: told by founders, managers, and employees, to stakeholders and one another, about core elements of each firm’s value proposition. We unpack how the narratives entrepreneurs wove about their intractable mission quickly evolved into meaningful dominant deceptions produced rapidly and collectively by many members within the organizations. While the literature on misconduct shows that organizational deceit often grows from small, private violations that become normalized and institutionalized, we identify an alternative pathway explaining the tenacity of deceit. We propose that deceit persists through entrenchment, as organizational members are open about and experiment with deception, and amplification, as organizational members justify deception and reinforce their belief in their venture’s mission through moral disengagement and cognitive dissonance. Through this research, we respond to calls to examine deception within entrepreneurial settings.