Essays on strategy and entrepreneurship communication

Cotter Salvado, Joao (2019) Essays on strategy and entrepreneurship communication. Doctoral thesis, University of London: London Business School.

Abstract

The present thesis investigates visual and linguistic characteristics of top managers and entrepreneurs' communication to external stakeholders, as well as the impact of this communication on investors' reactions. Structurally, the thesis consists of three essays. In the first essay, the focus is on the visual presentations used by top managers to explain their decisions to investors and analysts. The results of the analysis of Mergers and Acquisitions' (M&A) conference calls support the prediction that using visuals enhances the market's reaction to acquisitions, but with increased variance, which is consistent with the idea that providing clarity through visuals may also help expose a strategic decision's flaws. In the second essay, we investigate the language used by top managers when presenting strategic decisions to external stakeholders. In particular, we examine the relationship between top managers' use of words and expressions associated with business bullshit and the stock market reaction to the announced strategy. The results of analyzing an extended version of the dataset used in the first essay demonstrate that the use of language associated with business bullshit undermines investors' trust in a company's decision and, therefore, makes the investors respond to it less positively. Finally, in the third essay, I investigate the impact of disclosing the entrepreneur's face in the pictures used by entrepreneurs during online resource acquisition campaigns on potential investors' reaction. The results of empirical analyses of two entrepreneurial crowdfunding settings show that investors tend to favor those investment profiles that more prominently display the entrepreneur's face, and this tendency is particularly strong in cases when there is more uncertainty around the venture.