If you were an entrepreneur in a "hot" market, would you invest the substantial amount of time, energy, and other resources necessary to try and go public before the bubble bursts? Or would you prefer to utilize those resources to build your business and create value for customers?

I would prefer mobilizing resources to build a business and create value for customers.

Researchers discovered that entrepreneurs who focused on not-so-hot market categories were likely to do better once they entered the market category, presumably because they faced greater scrutiny by stakeholders before making a move. As a result, those non-consensus entrepreneurs were less likely to enter the new market with a flawed plan.

Step-by-step explanation

A hot market means low inventory combined with lots of buyers looking for the perfect place. In many instances, a hot market does indeed represent a faster sale at or above the asking price.

A period of unusually high success ends. A "bubble" describes something, typically a trend or market, that expands until it "pops" (fails). When the bubble bursts on these toys, many people will be left with a lot of worthless trinkets.

Entrepreneurs have a greater tendency to flock to that market. The result is less scrutiny by entrepreneurs of product-market fit before entering the now-hot market. Those startups are also more likely to leave the market category in later years.