Chapter 3 Contextual Motivation and Growth Aspirations Among Nascent Entrepreneurs Diana M. Hechavarria, Mark T. Schenkel, and Charles H. Matthews 3.1 Introduction ‘‘The concept of the nascent entrepreneur captures the flavor of the chaotic and disorderly founding process’’ (Acs & Audretsch, 2003, p. 3). A nascent entrepre- neur is defined as someone who initiates activities that are intended to culminate in a viable new firm (Reynolds, 1994; Davidsson, 2004; 2005). Yet, what moti- vates people to start a new business remains poorly understood (Shane, Locke, & Collins, 2003). Existing research indicates that there are micro-level and macro- level factors that influence the nascent entrepreneurial process. This chapter focuses on the latter, specifically exploring the macro–micro linkages in relation to context. Consequently, this assessment contributes to the understanding of entrepreneurial phenomena by specifically identifying contextual dimensions in which to differentiate types of nascent start-ups, which in turn, will lead to more precise interpretations of why individuals enter the firm creation process. The goal of the Panel Study of Entrepreneurial Dynamics I & II (PSED) is to identify how new firms come into existence through the study of nascent entrepreneurship. Two emphases have emerged from the project in order to understand the process of entrepreneurship. One centers around personal char- acteristics of individuals who pursue the new venture (Shaver & Scott, 1991) and the other is centered on the actual behavior initiated to establish a new firm (Gartner, 1998; Gartner, Shaver, Carter, & Reynolds). These factors focus on micro-level issues related to new firm creation. However, the firm birthing process occurs in a unique and specific environment (Reynolds, 2004). The multi-dimensional nature of entrepreneurship as a construct requires scholars to investigate not only the factors that have immediate impact on the start-up process along with those individuals who are directly involved, but also the contextual environment in which the entrepreneur operates. D.M. Hechavarria (*) University of Cincinnati, Lindner Hall 511, Cincinnati, OH 45221-0020 e-mail: hechavda@email.uc.edu P.D. Reynolds, R.T. Curtin (eds.), New Firm Creation in the United States, International Studies in Entrepreneurship 103, DOI 10.1007/978-0-387-09523-3_3, Ó Springer ScienceþBusiness Media, LLC 2009 35