/pdf/the-black-swan-the-impact-of-the-highly-improbable-578rzpihbf.pdf

The Black Swan: The Impact of the Highly Improbable

Against the Gods: The Remarkable Story of Risk

Purpose




Women in entrepreneurship can have a significant impact on economic and social development globally and particularly in developing countries. But the challenges entrepreneurial women face are unique and multiple, pressing the need for research and policies to maximize impact. The purpose of this paper is to analyze the challenges women start-up founders face to secure funding in the technology industry. The tech industry was selected because it is a non-traditional industry for women with high potential for role models to bridge an existing gap in information on women start-up founders to secure capital financing to attain business sustainability. It covers venture capital investors’ role, Latin American cultural reasons, and gender.




Design/methodology/approach




This study is based on an inductive, qualitative approach and in-depth interviews with 20 women entrepreneurs and start-up founders from Latin American countries who received support from the Chilean Government sponsored accelerator “Start-Up Chile.”




Findings




The analysis uncovered ten aspects that impact entrepreneurial women founders’ access to capital in three categories: capital needs, networks, and individual characteristics.




Originality/value




This study identifies factors that affect women entrepreneurs in raising capital and in facing the following challenges: first, working in a non-traditional field for women as it is the technology industry, and second assuming a leadership role as start-up founders. The results offer recommendation with potential to drive public policies in Latin America, which may be scalable to other developing and also to developed countries where market systems prevail. The findings show that women entrepreneurs, but also men, seeking start-up financing and alternatives are a viable source of employment and economic sustainability to mitigate the effects of increasing levels of unemployment worldwide.

Funding challenges of Latin American women start-up founders in the technology industry

Longevity in small business: The effect of maturity on strategic focus and business performance

In our global village, sustainability has been an important topic for all countries, and small businesses can create a competitive advantage through developing sustainability strategies. This conceptual article extends the current literature by presenting the case for small businesses to become integrated in the surrounding community and to make sustainability a strategic long-term competitive advantage and a critical co-producer of its long-term success. Implications and the need for further research are discussed.

/pdf/sustainability-as-a-small-business-competitive-strategy-111mv2f0pt.pdf

Sustainability as a Small Business Competitive Strategy

Purpose – The purpose of this paper is to empirically test for fundamental attribution error (FAE) – the naturally occurring bias of humans to over-attribute business success to celebrity-entrepreneur disposition. Design/methodology/approach – Employing a five-step process, this paper measures and tests for FAE bias in entrepreneurial situations. The methodology includes anecdotal historical evidence; developing a FAE survey instrument; having 101 respondents classify variables; statistically testing and validating the instrument; and then statistically identifying the importance of each factor with a sample 105. Findings – Significant statistical evidence for an active FAE bias was found. People do tend to attribute business success to entrepreneurial dispositions, rather than team behavior and circumstantial outcome factors which can reduce the effectiveness of public policy. Research limitations/implications – There is minimal research on FAE in entrepreneurship effecting public policy, thus there is a...

Measuring and testing general fundamental attribution error in entrepreneurship effecting public policy

There is no generally accepted measure of wealth created by new ventures, as most early-stage firms do not have positive cash flows, and early-stage discount rates cannot be estimated with sufficient accuracy as required by the Capital Asset Pricing Model (CAPM). Through regression analysis of organizational economic value, as assessed by a sample of 145 CPAs, this research supports using a new economic evaluation methodology involving the use of early-stage organizational structure itself as a construct and predictor of economic value. The current research employs a Validated Nascent Organizational Structure Sequence (VNOSS) model as an alternative to CAP-M in establishing the perceived economic value of early-stage entrepreneurial firms. The small business owner that utilizes the strategy of taking the firm through the VNOSS stages will create greater economic wealth. There is a substantial discussion of the implications of the applied research results.

Measuring Wealth Generation in Early-Stage Entrepreneurial Organizations: An Alternative to the Capital Asset Pricing Model

Utilizing Nobel Laureate, Daniel Kahneman's views on decision-making psychology and the general practice experience of Amazon's founder, Jeff Bezos, the authors formulate an approach to understand strategy and entrepreneurship. A hypothetical a priori probability model of a successful entrepreneurial venture is introduced in this paper. The model clarifies why the “prior to launch” probability of success is normally exceptionally low. But, low probability does not imply insignificance as free-market-driven new ventures with low probabilities of success can have a substantial impact on strategic planning within competitive firms. As a venture progresses through start-up phases and the probabilities of achieving individual critical single-events rise, the probability of venture success also increases as a function resembling the shape of a “hockey stick.” Entrepreneurially, the results show how a new venture's start-up can be quantitatively managed and analyzed with improved outcomes. The results provide some strategic insights on the difficulty of assessing competition as markets evolve.

Luck or Strategy? Some Insights Into Successful New Ventures

The issues of entrepreneurial ex-ante determination and managerial intent are discussed as applied to the ex-post organizational result. Possible errors in over-attribution of success to the celebrity-entrepreneur and the tendency to disregard the impact of endogenous market conditions, randomness on success due to creative destruction free-market mechanisms are discussed. Humans inherently look for correlation as correlations produce useful knowledge. Specifically, investors seek to create cause-effect knowledge in order to enhance returns. Students and researchers of business also attempt to tie causation to effects. Fundamental attribution error psychology posits a tendency to over-weight personality-based explanations and under-value situational factors when assessing what factors are responsible for the ex-post-facto outcome of an organization. In the field of entrepreneurship, this trait of human psychology may manifest in the tendency to credit the leader him/herself of a successful organization vis-a-vis more important external factors which contributed to success such as the temporal status of market demand conditions. The existence of fundamental attribution error may likewise lead to over-weight emphasis of a leaders input to organizational failure, however, the sample of entrepreneurs linked to successful organizations is self-selected as the unsuccessful entrepreneurs are usually not locatable. Therefore, stakeholders show strong tendencies to link the focus-entrepreneur with a resultant successful enterprise. This tendency is observable in the general culture as most students of entrepreneurship believe the knowledge and actions of Ray Kroc were a prime factor in the economic success of McDonalds. The question explored within the present study is to what extent is such ex-post-facto success attributable to the ex-ante entrepreneurial intent appropriate? Most people familiar with business strongly identify; Steve Jobs with Apple, Thomas Watson with IBM, Dave Thomas with Wendys, Bill Gates with Microsoft, Howard Schultz with Starbucks, Harland Sanders with KFC, and Fred Smith with FedEX. Instructors of entrepreneurship teach with these stories. More importantly, researchers of entrepreneurship use these leaders and their associated knowledge and behavior as independent variables when regressing these variables onto the ex-post dependent outcome of the organization. The investing and finance community also correlate these success story celebrity-entrepreneurs with the resulting rate of return on equity. This paper explores a series of archive-based recollections of the entrepreneurs ex-ante thoughts to demonstrate that many legendary-business entrepreneurs did not expect the organizations extraordinary rates of growth and the ex-post-facto market successes. Hence, cause-effect attribution questions arise. One important research question addressed within is; if the entrepreneur did not know of, or expect growth before the growth, then the resulting growth may not be fully attributed to the person as valid intent. More generally, then to what extent can the resulting organizational success be attributed to the identified behavior of entrepreneurship? Are the successes normally attributed to individual-entrepreneurs really organizational successes or even random-walk phenomenon? Are fundamental attribution errors over-weighing the construct of entrepreneurship and obscuring other, organizational-based, effective causes of economic success? The rise of the media-driven, celebrity-entrepreneur leads to a recent strengthening of attribution of organizational success to that leader. Conclusions within the current study lead to a more distinct focus on the time-limited tasks of entrepreneurship that are very limited in proportional impact to a firms total life-span and resulting economic value. We then can attribute much more of the resulting economic value to the impact of organizational dynamics and organizational development.

/pdf/the-entrepreneurs-random-walk-3f4gsx3sxt.pdf

The Entrepreneurs Random Walk

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Papers

Measuring and testing general fundamental attribution error in entrepreneurship effecting public policy

Measuring Wealth Generation in Early-Stage Entrepreneurial Organizations: An Alternative to the Capital Asset Pricing Model

Luck or Strategy? Some Insights Into Successful New Ventures

The Entrepreneurs Random Walk