Are entrepreneurial opportunities discovered or created?
January 26, 2022
by Nike Lorenz

Entrepreneurial solutions and new ventures seem to be everywhere. Therefore, opportunities for launching a venture must be widely spread as well, right? Or is our capitalist society reframing opportunities in order to justify yet another start up? 

First, let’s define the object of this article, the opportunity. According to Barringer& Ireland (2006) [11], it is "a favorable set of circumstances that creates a need for a new product, service or business". In addition, it represents the possibility for entrepreneurial action, to be undertaken by some alert individual [12].  

This leads us to one of the two theories on entrepreneurial opportunity presented by Alvarez& Barney (2007) [13]. The discovery theory suggests, that opportunities are already out there, due to market imperfections and changes in consumer preferences, waiting to be discovered. Metaphorically speaking, the mountain exists and any individual with the essential skills and knowledge detecting it, could climb it. 

While we may only remember the first person who conquered Mount Everest, entrepreneurial success doesn’t only come to the first one who discovered an opportunity gap. So how do the forces of capitalism work within this theory? How many times can one mountain be climbed while still referring to a „need of a new product, service or business“? In the fragile world we live in, we need to adapt our understanding of opportunities to one that takes into account what our planet needs more than what we want consumers to think they need in order to be a valid part of our society. 

The second theory on entrepreneurial opportunity is the creation theory. In comparison to discovery, it suggests that mountains have to be build first as they do not pre- exist out there. In this case, opportunities lie underneath everyday phenomena and interactions brought to light by entrepreneurs.

So with that, the creation theory assumes that opportunities only arise due to the entrepreneur, they do not exist without him or her. 

This theory relies heavily on the entrepreneur’s perception of the world [14] and with that contains a blind spot. The "key to opportunity recognition" is to identify a problem and a product or service that solves this problem. Therefore, entrepreneurs who create opportunities basically decide what problems there are to solve. Without doubt, this can result in outstanding innovation and progress for our society. 

But I am assuming, it can also result in the sculpting of a world perceived by the rich and powerful in order exploit the poor and oppressed. 

In 2019, Pinky Gloves was founded by two entrepreneurs and presented to the investors of the german version of shark tank, Höhle der Löwen. They invented a product, a pink plastic glove, to help menstruating people remove tampons in a, as they put it, "hygienic, safe and odorless" manner. Shockingly, two male investors partnered up with them. In other words, two white male dudes decided what women or menstruating people need while exploiting the stigma of menstruation and two other white male dudes with a lot of money thought it was a great idea. And that’s what we call the creation of an entrepreneurial opportunity? 

Luckily, enough people on social media detected the sexist and stigmatizing characteristics of Pinky Gloves and protested against it [see figure no.1]. Pinkly Gloves never sold a single pink glove. But how many products and services are still out there exploiting the forces of social constructs and hierarchies? 

Looking back on both theories, we should be aware of their views of knowledge as individualized and socially alert. Today it is market power and its capture rather than knowledge, productive capability, innovativeness, or creativity that is evermore central to profit [15]

As long as white males are still overly represented in entrepreneurship, the mountains that we refer to as opportunities will also prefer skills predominantly referred to as male, exploit opportunity gaps relying on social oppression and arise in better reach to privileged members of society.


[11] Bruce R. Barringer& Duane Ireland. (2006). Entrepreneurship : Successfully Launching New Ventures. New Jersey: Pearson Prentice Hall.  

[12] Kirzner, I.M. (2009). The alert and creative entrepreneur: a clarification. Small Bus Econ 32, 145–152. 

[13] Alvarez, Sharon and Barney, Jay. (2006). Discovery and Creation: Alternative Theories of Entrepreneurial Action. Fisher College of Business Working Paper No. 2006-01-005.

[14] Aldrich, H. E., & Kenworthy, A. L. (1999). The accidental entrepreneur: Campbellian antinomies and organizational foundings. In J. A. C. Baum & B. McKelvey (Eds.), Variations in organization science: In honor of Donald T. Campbell (pp. 19–33). 

[15] Hanlon, Gerard. (2014). The Entrepreneurial Function and the Capture of Value: Using Kirzner to Understand Contemporary Capitalism. ephemera: theory in politics & organziation. 14. 177.