The Evaluation of Founder Failure and Success by Hiring Firms: A Field Experiment.

This article investigates how hiring firms evaluate entrepreneurial human capital, specifically early-career job candidates with founder experience, and how this evaluation differs based on whether the candidate's venture succeeded or failed. Using a field experiment that sent 2,400 randomized applications for entry-level software engineering jobs across six U.S. metropolitan areas, the study finds that former founders receive 43% fewer callbacks than nonfounders, with successful founders facing the greatest disadvantage compared to failed founders. These results suggest that concerns about fit and commitment—rather than uncertainty about candidate quality—dominate recruiters' evaluations, particularly in older, more bureaucratic firms, while younger firms show less bias against former founders. The findings contribute to understanding organizational human capital strategies and have implications for entrepreneurs navigating wage employment, firms managing entrepreneurial talent, and policymakers promoting early-career entrepreneurship.