Failure is generally stigmatized. Yet, in entrepreneurship, failure is the most likely outcome. This dissertation explores how entrepreneurs use failure narratives and the peer community to recover from failure. Interviews with founders of failed firms and a cultural analysis of entrepreneurial failure narrative genres reveals that peers are ideally situated for making sense of failure while avoiding stigma because they are familiar enough with the context but not directly involved in the failure event. Paradoxically, public narratives connect failed entrepreneurs with valued peers, but expose the narrator to stigma. Computational text analysis and correspondence analysis of online failure narratives and narrator outcome data confirms that entrepreneurs do benefit socially from externalizing rhetoric, but also benefit from internalizing rhetoric that demonstrates entrepreneurial identity work. A network analysis of a virtual entrepreneur community tests boundary work as a mechanism for connecting entrepreneurs with supportive peers and finds evidence that peer communities may be open networks in which failure experience is valued over reputational signals. This research tests our understanding of entrepreneurship and failure and interrogates the role of rhetoric and the peer community in recovering from entrepreneurial failure.