Acceptance, adaptation and interaction: how entrepreneurs navigate institutional uncertainty in Iran’s emerging fintech industry?

Purpose Entrepreneurs in developing economies often face uncertainty due to weak or absent formal institutions, prompting them to rely on a combination of practices to mitigate this uncertainty and successfully create and develop their ventures. This study examines how entrepreneurs in Iran’s emerging Fintech industry navigate and respond to institutional uncertainty. This study aims to bridge the gap in understanding the intersection between institutional uncertainty and entrepreneurial action. Design/methodology/approach An inductive exploratory investigation was conducted using a multiple case study approach to examine how entrepreneurs navigate and manage institutional uncertainty. Findings Entrepreneurs adopt three primary modes of action in response to institutional uncertainty: acceptance, where entrepreneurs acknowledge the existing institutional status quo and overcome uncertainty arising from institutional constraints by managing their attention to what is controllable; adaptation, where they devise strategies to circumvent institutional challenges; and interaction, where they actively engage in communications to change harmful institutions through institutional entrepreneurship or bypass them by leveraging rent-seeking behaviors. Practical implications This research offers valuable guidance for existing and potential entrepreneurs on navigating institutional uncertainty. It provides insights into the mechanisms and strategies that entrepreneurs can employ in inefficient institutional contexts, thereby equipping them to better manage the complexities of their operating environments. Originality/value This study highlights the crucial role of entrepreneurs as microinstitutional agents in developing economies. By elucidating how entrepreneurs cope with uncertainty from weak or absent institutions, it enhances the understanding of entrepreneurial dynamics in challenging environments and contributes to the broader discourse on institutional theory and entrepreneurship.