Experiments by “Visionaries”

How do visionaries design experiments when they need to convince skeptical resource providers? This paper develops a model in which entrepreneurs and incumbent firms face fundamentally different challenges in pursuing disruptive technologies. Whereas visionaries may be optimistic about a technology’s prospects, they often require resources controlled by others with more conservative beliefs. We show that these resource constraints lead entrepreneurs to design experiments that maximize persuasive power rather than informational value; choosing high-bar experiments that generate clear positive signals when technologies succeed. In contrast, incumbent firms with internal authority prefer low-bar experiments that clearly identify technological failures.