Time-resolved optical reflectivity was used to study the kinetics in the early stages of vertically aligned carbon nanotube array growth from a molecular beam of acetylene. The molecular beam environment was used to suppress gas phase reaction pathways and limit the growth to surface reactions specific to the molecular structure of acetylene. The observed acetylene flux dependent induction delay and the threshold for vertically aligned growth are characteristic features of heterogeneous chain reactions. Propagation of chain reactions requires regeneration of the active sites that can occur only if catalytic activity is transferred from the metal catalyst film to surface carbon species. After the active site transformation, acetylene self-assembles into carbon structures of progressively increasing size such as chains, graphene fragments, and nanotubes. In this paper we show that a conceptual framework supported by ab initio density functional theory calculations in which active carbon species facilitate incorporation of new carbon readily explains recent results in vertically aligned nanotube growth that are puzzling in the context of the diffusion/precipitation model.