Two research streams in the entrepreneurship literature offer seemingly opposing views on how new ventures cope with environmental change. One suggests new ventures are rigid, lacking the resources and legitimacy to exploit arising opportunities and overcome new threats. The second suggests new ventures lack bureaucratic constraints, allowing these ventures to flexibly adjust alongside environmental changes. We propose that both perspectives describe actual entrepreneurial behavior. We further suggest that differences in behavior among new ventures exist due to variations in how entrepreneurs cognitively process information from the environment and the venture.