Entrepreneurship is an integral part of economic change and growth. Yet until recently it has been largely neglected by economists. In The Economics of Entrepreneurship, Simon C. Parker draws on ...theoretical insights and recent empirical findings to show how economics can contribute to our understanding of entrepreneurship. The book is based on an earlier work, The Economics of Self-employment and Entrepreneurship (Cambridge University Press, 2004), that has quickly become an essential reference for academics researching the economics of entrepreneurship. Written in a more accessible style, this book contains much that made this earlier work so successful and, in addition, includes improved pedagogical features and new material on the theory of the firm, spin-offs, nascent entrepreneurship, growth-enhancing knowledge spillovers and social entrepreneurship. It can be used both as a reference text for academics from a variety of disciplines and as a textbook for graduate students.
As self-employment and entrepreneurship become increasingly important in our modern economies, Simon C. Parker provides a timely, definitive and comprehensive overview of the field. In this book he ...brings together and assesses the large and disparate literature on these subjects and provides an up-to-date overview of new research findings. Key issues addressed include: the impact of ability, risk, personal characteristics and the macroeconomy on entrepreneurship; issues involved in raising finance for entrepreneurial ventures, with an emphasis on the market failures that can arise as a consequence of asymmetric information; the job creation performance of the self-employed; the growth, innovation and exit behaviour of new ventures and small firms; and the appropriate role for governments interested in promoting self-employment and entrepreneurship. This book will serve as an essential reference guide to researchers, students and teachers of entrepreneurship in economics, business and management and other related disciplines.
Often downplayed in the excitement of starting up a new business venture is one of the most important decisions entrepreneurs will face: should they go it alone, or bring in cofounders, hires, and ...investors to help build the business? More than just financial rewards are at stake. Friendships and relationships can suffer. Bad decisions at the inception of a promising venture lay the foundations for its eventual ruin. The Founder's Dilemmas is the first book to examine the early decisions by entrepreneurs that can make or break a startup and its team.
Drawing on a decade of research, Noam Wasserman reveals the common pitfalls founders face and how to avoid them. He looks at whether it is a good idea to cofound with friends or relatives, how and when to split the equity within the founding team, and how to recognize when a successful founder-CEO should exit or be fired. Wasserman explains how to anticipate, avoid, or recover from disastrous mistakes that can splinter a founding team, strip founders of control, and leave founders without a financial payoff for their hard work and innovative ideas. He highlights the need at each step to strike a careful balance between controlling the startup and attracting the best resources to grow it, and demonstrates why the easy short-term choice is often the most perilous in the long term.
The Founder's Dilemmas draws on the inside stories of founders like Evan Williams of Twitter and Tim Westergren of Pandora, while mining quantitative data on almost ten thousand founders.
People problems are the leading cause of failure in startups. This book offers solutions.
Becoming a Management Consultantfocuses on a different aspect of being a successful management consultant - from effective listening to leadership styles, self-employment, attracting prospective ...clients, and everything else in between. There are also exercises to be completed to help the reader hone their skills.
The analysis of Entrepreneurial Learning evolutions in startup hubs provides practical input to startup and incubator managers on the strategic drivers of change in training processes, investigating ...new trends of Entrepreneurial Learning in lean organizations.
The spillovers in knowledge among largely college-educated workers were among the key reasons for the impressive degree of economic growth and spread of entrepreneurship in the United States during ...the 1990s. Prior 'industrial policies' in the 1970s and 1980s did not advance growth because these were based on outmoded large manufacturing models. Zoltan Acs and Catherine Armington use a knowledge spillover theory of entrepreneurship to explain new firm formation rates in regional economies during the 1990s period and beyond. The fastest-growing regions are those that have the highest rates of new firm formation, and which are not dominated by large businesses. The authors of this text also find support for the thesis that knowledge spillovers move across industries and are not confined within a single industry. As a result, they suggest, regional policies to encourage and sustain growth should focus on entrepreneurship among other factors.
The study extends the literature on venture capital by examining whether entrepreneur's choice for an external investor and certain firm characteristics have an impact on venture success or not. The ...focus is set on the differences in value creation by venture capitalists and business angels for ventures of the high- and low-technology sector. The assessment of a data set including 252 Series A financing rounds by venture capitalist firms, business angels and collaborative investments of both investors conducted between 2005 and 2012 unveils value enhancing aspects for all three financing solutions. Overall, start-ups initially financed by venture capitalist firms perform best with regard to general venture success, whereas start-ups collaboratively supported by venture capitalists and business angels have the highest chances to exit successfully through a trade sale. It becomes further apparent that ventures located in one of the high-technology industries 'internet', 'pharmaceuticals' and 'high-tech', ventures that are longer established in the market and ventures whose Series A financing round was executed more recently indicate an enhanced likelihood of success. Auszug aus dem Text Text Sample: Chapter 3, Literature review and Hypotheses development: The general difference in investment volume between BAs and VCs is more or less known, even though it may vary from venture to venture. The value creation by both investors beyond mere financial capital is complex and consists of different components. The following section assesses academic literature produced so far with regard to each investor's unique approach of creating value for a new venture. Additionally, significant complementarities resulting from collaborative investment are outlined. For each tendency in the literature, two hypotheses focusing on the high- and the low-technology sector
are developed. 3.1, Value creation of business angels: One very important factor of entrepreneur's financing decision is the value provided by each type of financing since both supply more than solely financial capital (Kaplan & Stromberg, 2001; Prowse 1998; Gorman & Sahlman, 1989). BAs create value by mentoring, strategic advice, networking and sometimes a functional capacity in the start-up. Contributions to the venture such as serving as a sounding board (Harrison & Mason, 1992), interfacing with the investor group, monitoring financial performance and formulating business strategy (Ehrlich et al., 1994), use of BA's personal network, coaching and provision of financial know-how (Brettel, 2003), enhancement of management skills and help with additional fund raising (Paul, Whittam & Johnston, 2003), were perceived as the most valuable non-financial contributions by BAs. As BAs typically invest in markets and industries they formerly worked in, entrepreneurs can benefit from the expertise, knowledge and experience BAs gained over years. Many entrepreneurs even confirm that the hands-on involvement of BAs discussed before adds more value to the venture than the actual capital and enhances the prospects for venture success (Mason, 2011). The participation of a BA can also serve as a steppingstone. Madill, Haines Jr. and Riding (2005) ascertain that 57% of the ventures in their sample which had received initial angel investment also obtained later VC financing, whereas only 10% of ventures without angel financing received later VC financing. Thus, it can be assumed that BA investment helps ventures to become 'more ready', thereby enhancing venture's growth potential and the likelihood of a successful venture exit. It is reasonable that the hands-on involvement in form of network opportunities, assistance in legal advice, accountancy advice and the
provision of resources as well as business and marketing intelligence creates substantial value. BAs are heterogeneous individuals who are actively involved in the venture and thereby provide individual combinations of contacts, guidance, and governance, as reported by all 33 companies in the sample. Although it needs to be stated that angel financing is not a necessary requirement for later stage VC financing, BAs have an accrediting role as they provide trust and credibility for recently founded and mostly unknown start-ups. The fact that BAs invest their own capital and are not obliged to manage an investment fund raised by other people's money can work as an advantage for the entrepreneur. In many cases, BAs tend to overinvest with the result of earning zero profit but higher stakes in the firm. So on the one hand, they gain more control rights and the entrepreneur loses control to certain extent. But on the other, they are also forced to exert effort the more money they invest and consequently have a stronger incentive to contribute valuable input to the venture (Leshchinskii, 2002). The BA becomes more and more part of the venture and is consequently also interested in its success. Goldfarb et al. (2009) also find a positive relationship between angel participation and the probability of a successful venture exit. Specifically, angel-only financed deals have a 33% to 36% higher chance to survive compared to other deals assessed in the sample. Concluding, there is extensive evidence for value creation beyond mere financial capital by BAs in new ventures, either in form of active hands-on involvement or due to the characteristics of the relationship between BA and entrepreneur itself. From the literature produced so far, it is impossible to determine on which technology sector BAs have a more significant impact on value creation. Nevertheless,
it can be assumed that BAs are less beneficial for ventures in the high-technology sector, as those require structured advising and specialist knowledge skills (Lockett et al., 2002). It follows that. H1a: The financing by a BA has a positive impact on value creation and thus enhances the prospects of success for a venture in the High-Technology sector. H1b: The financing by a BA has a positive impact on value creation and thus enhances the prospects of success for a venture in the Low-Technology sector. Contrary to the findings discussed before, several studies attribute limited value creation potential to BAs. Chemmanur and Chen (2006) state that BAs fail to add significant economic value to the venture. BAs tend to invest in ventures in less technologically sophisticated and knowledge intensive areas, leaving less potential for value creation to them. Consequently, entrepreneurs who have broad technological knowledge themselves tend to have self-financing or angel-financing as financier's incremental value added may be limited. Based on their model, the authors come to further highly interesting conclusions regarding the financing path of ventures. Ventures which can initially attract and maintain VC financing over several financing rounds have the highest chance of going public or being acquired, thus have the highest quality. Ventures that are financed by BAs in their early stages and later switch to VCs will less likely have a successful exit, hence are of lower quality. Finally, ventures which start with VC financing and later switch to BAs or obtain BA financing only through all financing stages have the least chances of going public or be successfully acquired and indicate the lowest quality. Fairchild (2011) uses a behavioral game-theoretic approach and also underscores the lack of value creation potential of BAs. He emphasizes that
besides economic factors, behavioral aspects also influence entrepreneur's financing choice. Whereas VCs provide higher-value adding capabilities in economical terms, entrepreneurs often benefit from an empathetic and trusting relationship with a BA. This promotes mutual trust and thereby mitigates double-sided moral-hazard problems. The findings of Fairchild (2011) are supported by Freear et al. (1994), who also emphasize the more interpersonal relationships with BAs, providing the benefits of a productive and trustful atmosphere. Still, it is uncertain if the benefits of a trustful relationship lead to economic growth, thus. H2a: The financing by a BA has no impact on value creation and thus does not enhance the prospects of success for a venture in the High-Technology sector. H2b: The financing by a VC has no impact on value creation and thus does not enhance the prospects of success for a venture in the Low-Technology sector.
Purpose: This article aims to analyze how the practices related to the development of people in startups are configured. Originality/value: Considering that, until then, studies referring to startups ...focused on their concept, characteristics, and key success factors, this research contributes to filling a gap in the theory, as it presents a people development model suited to the characteristics of startups and, in this way, it makes possible to the founders or managers of startups to use the findings of this research in order to improve their performance. Design/methodology/approach: The methodological aspects of this research are characterized by exploratory and qualitative research. Semistructured interviews are used as a collection technique in 16 startups. Findings: We observed that in startups: Teamwork is prioritized, the work environment is informal, the development of competencies occurs in the work environment itself through self-development or training provided by specialized professionals or by the leadership, there is flexibility in the time, place, manner in which activities are carried out, and the employee may even act in activities that would not be the responsibility of the position held. Keywords: high performance, human resource development, startups, competencies, people management Objetivo: Este artigo visa analisar como se configuram as praticas referentes ao desenvolvimento de pessoas em startups. Originalidade/valor: Considerando que, ate entao, os estudos referentes as startups focalizavam o seu conceito, as suas caracteristicas e os seus fatores-chave de sucesso, a pesquisa colabora para suprir uma lacuna na teoria, pois apresenta um modelo de desenvolvimento de pessoas mais adequado as caracteristicas das startups e, dessa forma, contribui para que os fundadores ou gestores de startups utilizem os achados desta pesquisa para aprimorarem sua atuacao. Design/metodologia/abordagem: Caracteriza-se por ser uma pesquisa exploratoria e de natureza qualitativa. Para tanto, utilizaram-se entrevistas semiestruturadas como tecnica de coleta de dados em 16 startups. Resultados: Verificou-se que nas startups prioriza-se o trabalho em equipe, o ambiente de trabalho e informal e o desenvolvimento de competencias ocorre no proprio ambiente de trabalho, por meio do autodesenvolvimento ou de treinamentos ministrados pelos profissionais especializados ou pela lideranca. Existe flexibilidade no horario, no local, na forma de execucao das atividades e o funcionario pode atuar em atividades que nao seriam de responsabilidade do cargo exercido. Palavras-chave: alta performance, desenvolvimento de pessoas, startups, competencias, gestao de pessoas
In this witty and wise guide to the dilemmas of entrepreneurship, Rizwan Virk debunks misconceptions about how the world of startups works and offers hard-earned advice for every step of the journey. ...Startup Myths and Models is an ideal companion for readers from those just embarking on the startup life to those looking for their next adventure.
Delving into timeless lessons for getting your talent development firm off the ground and moving your business forward, this practical book offers sage advice on overcoming barriers to success and ...tips for handling potential industry disruptions.
