The notion of ‘place’ has gained significant traction in management research in recent years as a better way of understanding why people make certain decisions because of a specific location (e.g., place-sensitive products) but also how policies are better designed to align with the specific needs of a context (e.g., place-based investment). Place – understood as locations, including material entities with symbolic value – is the main focus in our recent paper on cultural entrepreneurship in Journal of Management Studies. Specifically, we set out to study how entrepreneurs in the deprived context of Ghana talk about public and private places to attract investment and legitimacy. This blog could be of interest to support organisations, investors, microfinance institutions and other NGOs who work with entrepreneurs in developing countries.

Places and Stories

The academic literature has been particularly interested in ‘cultural entrepreneurship’ in recent years. Put simply, this strand of literature is concerned with how entrepreneurs convince other important stakeholders that their businesses are worthy of support (and often investment). To achieve this, entrepreneurs often tell stories about their venture’s success, the value and innovativeness of their products/services and why they’re the best person to execute a plan. This could be in conversations with prospective customers/suppliers, support organisations and/or investors. To date, most research has focused on start-up pitches and written business plans to try to understand these entrepreneurial stories.

But what sort of stories do entrepreneurs tell in settings where pitching and written business plans is not the norm? Our study focuses on a group of entrepreneurs in the developing economy context of Ghana. Through immersive field research, we found that entrepreneurs tend to tell stories about places as a strategy to convince stakeholders that their new ventures are legitimate and that they are capable business owners.

Narrating Place

Over a 4-year period, we conducted a total of 87 interviews. Our main source of data was with entrepreneurs themselves, specifically those living around the poverty line in the town of Kasoa, Ghana. To better understand whether different stakeholders were convinced by these entrepreneurial stories, we interviewed loan officers from their main source of investment which was a local microfinance institution.

We discovered projective, connective, and authoritative significance of place as narrative strategies developed by entrepreneurs. In projective, entrepreneurs can communicate their physical place of trading as a viable and stable entity for investment. In connective, entrepreneurs draw from public places to gather information, indicating to investors that they are pro-active entrepreneurs. In authoritative, entrepreneurs are more autonomous in constructing place, taking more control over the industry within their local community. All these approaches demonstrate how entrepreneurs convey their individual and business capabilities to key investors over the different phases of venture development.

Place and Poverty

In deprived contexts throughout much of the global south, entrepreneurship has been discussed as a route out of poverty. Microfinance institutions – such as those in this study –have been at the forefront of this discussion. The idea being that financial investment targeted at low-income entrepreneurs, who typically could not access the financial system, would enable to grow their income, and gradually move away from the poverty line.

However, much of the logic in this space is imported from western models so that investors are often looking for formal markers of legitimacy such as business assets and documented growth strategies. Whilst these may still be relevant in some respects, our study shows that they are held together by a broader place-based narrative strategy developed by entrepreneurs. For example, business assets such as having a reliable physical trading space where products are safely stored take on a symbolic quality indicating that the business is stable.

In short, as we try to support entrepreneurs in developing economy contexts, we should look beyond the traditional success stories that entrepreneurs tend to tell in western contexts. In a context where product reliability, affordability and awareness are often low, stories are geared towards projecting the reliability of a physical place, how information is gathered across public places as well as how they gain authority in their local community.