XVI. IBANESS Congress Series on Economics, Business and Management – Istanbul / Turkey XVI. IBANESS İktisat, İşletme ve Yönetim Bilimleri Kongreler Serisi – İstanbul / Türkiye September 11-12, 2021 11-12 Eylül 2021 122 Start-up identity – lifecycle-based self-identification classification of start-ups based on artificial intelligence and natural language processing Márton Gosztonyi 1 1 Budapest LAB Enterprise Development Center, Budapest Business School University of Applied Sciences Abstract: The paper covers a lifecycle-based self-identification analysis of start-ups in a semi-peripherical country. We use artificial intelligence-based (AI) natural language processing (NLP) analysis on interviews with Hungarian start-up’s founders to examine how start-ups’ self-identification changes along lifecycles based on venture capital investment and inherent classification. Thus, we examine which system process and corresponding category system promote a company to define itself as a start-up. Our results show that start-up identity is not constructed as a constant entity but as a constantly changing space, which can be divided into well-defined segments and outlines the action horizon of the given economic organisation. Keywords: Start-up, Business Identity, Natural Language Processing, Text Mining, Artificial Intelligence Start-ups, change of variety The self-identification of firms largely determines the event horizon of their economic transactions (Seppänen et al., 2015). As a result, analysing the identity of businesses can help us gain a deeper understanding of the actions and long and short-term economic strategies that a particular company implements. Although we already have pervasive literature on the identity of businesses, in the case of start-ups, this line of research still holds many unanswered questions (Sutton, 2000). In the literature, start-up self-identification is usually seen as an unchanging entity. This definition is crystal clear as the entrepreneurial idea emerges and unchangeably follows the company until its exit (Dufour et al., 2018; Jawahar-McLaughlin, 2001; Lester et al., 2003). This is because theorists mostly focus on start-ups in the epicentres of start-up ecosystems (Silicon Valley, Tel-Aviv). Consequently, fewer discourses are available about start-ups operating in semi-peripheral economies. In our study, we supplement these theories by focusing on start-ups operating in Hungary, a country with a semi-peripheral economy, and examine how variable the self-identification of start-ups is in this context. We also analyse the factors and categories that shape the start-up identity. The start-up form is one of the manifestations of entrepreneurship (Wennekers & Thurik, 1999; Zacharakis et al., 1999), which contributes greatly to the innovative and competitive advantage and economic growth of a given economy (van Praag & Versloot, 2007). However, the definition of the concept itself can be approached from several theoretical foundations. So, its definition is spread over a wide spectrum in the literature, highlighting its different mechanisms of action. The concept appears in the late ’60s, early ’70s under the collective concept of ‘fast-growing businesses’. At this time, theorists focused on differences in the accumulation of investment as well as start-up costs in definitions (Aschmann, 1970) and the limited funding that any fast-growing firm must face (Ray et al., 1974). By the 1980s, the start-up concept had been narrowed down to companies operating in a particular industry. This concept primarily included early-stage semiconductor companies (Angel, 1989; Schoenberger, 1996). Thus, a term for the phrase ‘fast-growing electronic start-ups’ (Florida, 1991, p. 256) was created. Parallel to the turbulent growth of the start-up sector in the 1990s and 2000s, the definition space expanded. Rapid growth (Saxenian, 1994) in an extremely unstable economic environment came to the forefront in the definition (Markusen, 2003). New types of finance-related companies and venture capital businesses (Bussgang, 2010) found the role of idea-based operation, informality, and hard work crucial for exponential growth in firms (Barringer et al., 2005; Feld & Mendelson, 2016). By the 2000s, start-ups had created new industries. They were at the forefront of developing innovative products and services (Feeser & Willard, 1990), thus, adding industry experience as a relevant factor to the definition (Hwang & Horowitt, 2012). By 2010, process-and-context-based definitions of start-ups emerged from feminist economic geography and post-structuralist theories (Yeung, 2015). These definitions transformed the definition of start-up to the status of a narrative (Cockayne, 2019) in which both corporate actions and employee functioning are reanalysed. Thus, start-ups can be defined as a working