Entrepreneurial Effort Research Articles

Impact of Self-Regulated Learning on Entrepreneurial Opportunity Recognition and Academic Entrepreneurship Performance

The ratio of academic scientists to the labor force in Malaysia has increased. However, the contribution of academic scientists to commercialize research discoveries remains limited. Successful research commercialization or university technology transfer requires entrepreneurial effort that may involve skills beyond the traditional roles of academics. The ability to identify the commercial opportunity of research, i.e. entrepreneurial opportunity recognition, has been proven to be a critical skill for an academic entrepreneur. Earlier findings in this area would have been far more useful if the antecedents of entrepreneurial opportunity recognition were recognized. Although self-regulated learning has been inferred to as informal entrepreneurship education for academic entrepreneurs, there has been a lack of evidence on how it influences their academic entrepreneurship performance. This paper examined the characteristics of academic entrepreneurs and the key success factors, whether academics’ opportunity recognition ability is influenced by their self-regulated learning behavior. A quantitative research design was employed based on a case study of a technological university in Malaysia involving 115 academic entrepreneurs. Structural equation modeling analysis results revealed that academics’ opportunity recognition and social capital are the most important determinants of their academic entrepreneurship performance. The efficiency of the Technology Transfer Office and the ease of securing funding play influential roles too, but to a smaller extent. Most importantly, opportunity recognition is strengthened by self-regulated learning, through frequent deliberate practices in information and knowledge seeking that enable scientists to be more creative and innovative in translating research into marketable products and technology.

Entrepreneurial ecosystems: Spanning the institutional gaps in emerging economies via incubator networks

ABSTRACT Entrepreneurs need physical, financial, and social resources to succeed, but institutional gaps in emerging economies limit access to these resources. Current research shows that entrepreneurial ecosystem entities, such as business incubators, have a considerable influence on creating networks for novice entrepreneurs. Through a partially grounded research approach, this article explores the micro-level relationships of entrepreneurs within and outside the incubator. Our findings reveal that novice entrepreneurs interact most with mentors and incubatees to achieve results within entrepreneurial ecosystems of emerging economies. Key propositions about entrepreneurial effort, entrepreneurial networking, the incubator web, and trust-based interactions could aid further research.

A bargaining model for PLS entrepreneurial financing: A game theoretic model using agent‐based simulation

AbstractThis article aims to use a bargaining power model to reduce moral hazard—in the form of entrepreneurial effort shirking—and derive an optimum sharing ratio of a Profit and Loss Sharing (PLS) contract that involves a Venture Capitalist and an Entrepreneur. The model reveals the following interesting findings. First, under complete information—where the Venture Capitalist has a bargaining power ‐ Venture Capitalist offers the entrepreneur a profit sharing ratio that is less than her capital contribution ratio. Second, in an incomplete information setting, the entrepreneur demands a profit sharing ratio higher than her capital contribution ratio when the sum of the marginal cost (from exercising a higher effort) and private benefits (from exercising a low effort) is greater than the marginal return (from exercising a high effort). In addition, the model is used to derive a span of negotiation about the profit sharing ratio. Finally, an agent based simulation (Netlogo) platform is considered to implement the model, which allows a faster numerical calculations of the profit share and helps decide on the validity of the funding contract.

A Theory of ICOs: Diversification, Agency, and Information Asymmetry

This paper develops a theory of financing of entrepreneurial ventures via crypto tokens, which is not limited to platform-based ventures. We compare token financing with traditional equity financing, focusing on agency problems and information asymmetry frictions associated with the two financing methods, as well as on risk sharing between entrepreneurs and investors. Token financing introduces an agency problem not present under equity financing (underproduction), while mitigating an agency problem often associated with equity financing (entrepreneurial effort underprovision). Our theory abstracts from all institutional and potentially transient differences between tokens and equity and is based on a single intrinsic characteristic of tokens: they represent claims to a venture’s output. We show that tokens are likely to dominate equity for ventures developing goods or services that involve low marginal production costs, those for which entrepreneurial effort is crucial, and/or those with relatively low payoff volatility. In addition, tokens can have an advantage over equity in signaling venture quality to outside investors. This paper was accepted by Kay Giesecke, finance.

Do the rich give more? The effects of family wealth and entrepreneurial effort on firm philanthropy and growth.

Past research has offered conflicting evidence concerning the effect of family wealth on philanthropy. Equality of Opportunity (EOP) theory has received wide scholarly attention to explain an individual’s philanthropic engagement through the simultaneous consideration of both family wealth and personal effort. Drawing on the insights of EOP, we extend EOP toward entrepreneurial theory and practice by examining how entrepreneurs’ family endowment and entrepreneurial effort impact their charity donation and business growth. Utilizing a large, national dataset with 2503 Chinese entrepreneurs, our findings suggest that entrepreneurs with higher level of entrepreneurial effort are more likely to donate to charity and achieve greater firm growth in the process. In addition, higher level of entrepreneurial effort attenuates the contribution of philanthropy to firm growth. Conversely, no significant effect with respect to family wealth was found.

Entrepreneurial Efforts and Opportunity Costs: Evidence from Twitch Streamers

In the last decade, there has been substantial growth in the number of individuals deriving income through digital platforms (e.g., Uber, Airbnb, Instagram), including from live streaming platforms. In this context, we examine whether reduced opportunity costs, such as having more free time and being unemployed, affect people’s entrepreneurial efforts, particularly regarding professionalized streaming activity. As such, we use an extensive longitudinal dataset gathered from the live-video streaming service Twitch.tv, and we exploit the changes and restrictions brought about by the COVID-19 pandemic to measure individuals’ responses to having to spend more time at home, also given that some streamers were more affected than others. By comparing newcomers to established streamers, we find that all streamers intensified their efforts during this period and that this effect was particularly strong for streamers who were somewhat but not fully professionalized prior to the pandemic. This is consistent with the view that low opportunity costs are advantageous for starting and professionalizing activities in the platform labor market, that the work is taken up because of a lack of alternatives and, thus, can provide a form of insurance. This especially holds for streamers who had reached a certain threshold pre COVID-19, as performing at this level enabled them to consider further professionalizing their streaming activities. The ex-post analysis of newcomers’ success shows that even when mobility increased beyond pre-lockdown levels and unemployment rates had again fallen strongly, the most successful “newcomer” streamers were able to transform their initial reaction of potentially only income smoothing to a sustainable long-term solution with the potential for further entrepreneurial effort.

Rent Seeking in Blockchain Governance: The Awkward Transition From Market Decision Making to Non-market Decision Making

Blockchains and applications built on blockchains are decentralised ecosystems that are nonetheless built by centralised firms. The typical launch and maturity of a blockchain ecosystem involves the transition from an entrepreneurial institutional arrangement characterised by market decisionmaking to a decentralised one characterised by non-market decisionmaking. This paper considers how to assess rentseeking in the context of blockchain governance. Rentseeking in blockchain implementations and ecosystems occurs when participants seek rewards or privileges in excess what would be considered a market contribution after a certain threshold of decentralisation. The paper considering two controversies in blockchain governance – the Zcash founders’ reward and the SushiSwap developer fund – which involved the intertwining of mechanisms to fund public goods with mechanisms to compensate founders for their entrepreneurial effort. The paper finds that the normative ideal of decentralisation in blockchain governance has a parallel function to the normative ideal of liberal governance in political systems.

Heterogeneous hybrid entrepreneurs - framing the variation in entrepreneurial effort and motives for hybrid entrepreneurship

This paper brings together two important distinctions in the study of entrepreneurship: the difference between full-time and hybrid entrepreneurship and the difference between productive and unproductive or predatory entrepreneurship. We combine the literature on hybrid entrepreneurship, primarily identifying significant differences compared with full-time entrepreneurs, with an adapted framework to distinguish different motives for entrepreneurial effort aimed at productive or unproductive and predatory outcomes. This provides an overview which allows us to identify potential venues for further research to understand both hybrid entrepreneurship and the role it may play in the economy in the future.

When Less is More: Information and the Financing of Innovation

This paper examines the impact of informational frictions when the entrepreneur anticipates having little or no bargaining power in negotiating with the financier and can select ex ante the innovation/venture he wants to develop. In this environment the entrepreneur faces a tradeoff between selecting an innovation that creates high value but one which only allows him to capture little or none of that value; or selecting a pet-project innovation that creates lower value but yields private benefits to him. In the baseline scenario, without contractual frictions, the financier is able to elicit first-best entrepreneurial effort, but cannot commit not to extracts all innovation rents from the entrepreneur, leading him to select his favored but inefficient innovation the first place. The key insight of the model is that the introduction of informational frictions like non-verifiability of effort or talent asymmetry, while leading to reductions in effort (for a given innovation choice), do lead to more efficient (i.e. higher value) innovation choices ex ante, and indeed could generate superior payoffs for the entrepreneur and the financier, as well as a greater expected total surplus from innovation. This yields several empirical implications, not least of which the potential motivation for financiers to commit to opacity of information when the resulting improvements in innovation selection dominate the impact of effort reduction.

Heterogeneous hybrid entrepreneurs - framing the variation in entrepreneurial effort and motives for hybrid entrepreneurship

This paper brings together two important distinctions in the study of entrepreneurship: the difference between full-time and hybrid entrepreneurship and the difference between productive and unproductive or predatory entrepreneurship. We combine the literature on hybrid entrepreneurship, primarily identifying significant differences compared with full-time entrepreneurs, with an adapted framework to distinguish different motives for entrepreneurial effort aimed at productive or unproductive and predatory outcomes. This provides an overview which allows us to identify potential venues for further research to understand both hybrid entrepreneurship and the role it may play in the economy in the future.

The Role of Entrepreneurial Self-Efficacy and Entrepreneurial Passion in Business Performance

Small enterprises contribute significantly to the economic growth and prosperity in countries (Birch, 1987). The field of entrepreneurship represents an increasingly dynamic productive force in the economy (Gavron et al., 1998). Various entrepreneurship researchers opposed the construct of entrepreneurial self-efficacy (ESE), defined as an individual's belief in his or her ability to achieve various entrepreneurial tasks (Miao, Qian and Ma, 2017). Many studies have found positive relationships between ESE and entrepreneurial intention. On the contrary, there are some ambiguity on relationship between ESE and entrepreneur's post- start up performance (McGee et al. 2009). One of the affective entrepreneurial dimension is passion. Many researchers have opposed passion as a key element of entrepreneurial effort (Cardon et al., 2009; Chen et al., 2009) because it is able to bring up creativity and the recognition of new information patterns critical to the encounter and exploitation of encouraging opportunities (Baron, 2008; Cardon et al. 2013). However, there is little research focusing on entrepreneurial passion (EP), leading to business performance (Cardon et al. 2013). Thus, this research clarify how entrepreneurial self-efficacy (ESE) effect to business performance, and entrepreneurial passion (EP) may vary the ESE- business performance relationship as a mediator. Keywords: Entrepreneurial Self-Efficacy, Entrepreneurial Passion, Business Performance

Air in Unexpected Places

Aircrete is a lightweight building material with a number of remarkable qualities, including high compression strength, buoyancy and thermal insulation. Perhaps most strikingly, its lack of sand aggregate makes it energy efficient compared to concrete. While aircrete is regularly sold by various construction companies, DIY enthusiasts and technicians around the world are cultivating more home-brew, open-source methods. This article follows James, an American ex-security contractor and mining engineer, as he attempts to convert his own embodied legacies of imperial extraction into a pro-social business venture by designing aircrete machines and mixes for urban Africa. His adventures in aircrete typify an energy future in which an array of intriguing experiments and technologies intersect with a broader entrepreneurial effort to capture Africa’s growing consumer markets.

An aristocratic enterprise: the Ginori porcelain manufactory (1735–1896)

This study analyses the history of the Ginori porcelain manufactory, from its foundation owing to the entrepreneurial effort of the marquis Carlo Ginori in the 1730s to the merger with the ‘Società Ceramica Richard’ in 1896. The aristocratic entrepreneurship marked the manufactory with some atypical traits in accountancy, administration, succession, and strategic decisions that persisted for all the century and a half during which it remained in the hands of the Ginori family. The history of the Ginori manufactory so highlights a kind of entrepreneurship neglected by historiography.

Predicting the success of entrepreneurial campaigns in crowdfunding: a spatio-temporal approach

As an alternative to traditional venture capital investment, crowdfunding has emerged as a novel method and potentially disruptive innovation for financing a variety of new entrepreneurial ventures without standard financial intermediaries. It is still unknown to scholars and people who use crowdfunding services whether the crowdfunding efforts reinforce or contradict existing theories about the dynamics of successful entrepreneurial financing as well as the general distribution and use of crowdfunding mechanisms. This paper presents new results obtained from investigating the Kickstarter campaign data of over ninety-nine thousand projects totaling about 1 billion USD in pledges from 2009 until the most recent 2017 through dynamical spatio-temporal modeling. The funding level, the percentage of a project’s goal actually raised from online communities, is used as the outcome of interest in the modeling to associate with dollar pledged and backer count that reflect the signals of underlying project quality. Evidence from the results was found to support the dynamic impact of the geographic location of a Kickstarter on its success and the associations between the observed project traits and the success of the entrepreneurial effort in the presence of the unmeasured spatio-temporal confounding. These results offer further insight into the empirical dynamics of the emerging phenomenon of online entrepreneurial financing about the role the spatio-temporal component plays in both the type of projects proposed and the association of sociocultural traits of successful fundraising with the underlying quality.

“I Put in Effort, But I am Still Not Passionate”: The Influence of Person-Entrepreneurship Fit

Entrepreneurial effort has been found to be an important predictor of entrepreneurial passion: The more effort one devotes to entrepreneurial activities, the more passionate one becomes. Our work, however, extends prior research by offering contrasting empirical evidence. Drawing on fit theory and the person- entrepreneurship fit perspective, we conceptualize two types of fit: anticipatory person-entrepreneurship fit and perceived person- entrepreneurship fit and show that these two types of fit jointly shape the entrepreneurial effort – passion relationship. Our results suggest that entrepreneurial effort reduces individuals’ perceived person-entrepreneurship fit as well as entrepreneurial passion when individuals anticipate a poor person-entrepreneurship fit before making an effort. Our research thus contributes to the entrepreneurial passion and person-entrepreneurship fit literature and offers practical implications for would-be entrepreneurs and entrepreneurship advisors.

Relating Passion to Entrepreneurial Effort, Self-Efficacy, and Performance: A Meta-Analysis

Entrepreneurial passion is becoming a hot research topic, and we perform a comprehensive meta-analysis based on 51 independent samples (N= 21,808) to synthesize empirical evidence and test a theoretical model. Our results show that entrepreneurial passion is related to entrepreneurial self-efficacy, effort, and performance, respectively. The structural equation modeling results show that entrepreneurial passion’s relationship with performance is mediated by entrepreneurial self-efficacy and entrepreneurial effort in that sequence. We also took a closer look at a widely used entrepreneurial passion measure developed by Cardon and colleagues (2013), and found tentative yet non-conclusive evidence that it has larger effect sizes than a previous measure of work passion developed by Vallerand and colleagues (2003). When scholars deviate from this measure’s usage guidelines (e.g., by combining passion scores across domains, or by not multiplying the identity centrality score with the feeling score), the effect sizes do not seem to drop. We discuss the implications of our work and ideas for future research.

Motivating Corporate Entrepreneurial Effort: Champions, Followers, and How Innovation Climate Matter

Drawing on Self-Determination Theory and championing research, we hypothesize that intending to act as champion or follower of corporate entrepreneurial projects moderates the translation of autonomous and controlled motivations into corporate entrepreneurial intentions and subsequent effort. From a situated cognition perspective, we further hypothesize that pro-innovation organizational climate perceptions moderate the project champions and followers’ long-term corporate entrepreneurial efforts. We test these hypotheses using longitudinal surveys of 326 Finnish employees. We find that, while both autonomous and controlled motivations drive followers’ corporate entrepreneurial intentions, only controlled motivations drive champions’ corporate entrepreneurial intentions. Furthermore, we find that pro-innovation climate positively moderates the relationship between earlier intentions and later corporate entrepreneurial efforts only for champions, but not for followers.

Entrepreneurial alertness in eustress complex environments: An experimental approach of the exploitation/exploration dilemma

AbstractTechnological and organizational constraints hinder entrepreneurial ability in alertly selecting/exploiting new opportunities. This article aims at showing that the complexity of the environment shapes entrepreneurial alertness. We build an experiment to mimic the choice alertness process (a case of eustress) and measure alertness and its relations with opportunity appearances, entrepreneurial effort, and complexity of the production structure. We show that alertness increases with the selection of more opportunities, but not with the complexity of the environment itself. At the same time, the entrepreneurial effort rate reduces alertness significantly more when participants are in a complex environment.

The Effects of Corporate Taxes on Small Firms

We study the impact of corporate taxes on firm-level investments, total output and input usage by exploiting a 4.5 percentage-point corporate tax rate cut in Finland in 2014. We use detailed administrative data and a differences-in-differences method comparing small corporations (tax rate cut) to similar partnerships (no change in tax incentives). We find no significant investment responses. However, we observe an increase in annual sales and variable costs, suggesting that corporate tax rates have an effect on business activity. The effects are driven by entrepreneurs who actively work in their firm, suggesting that the tax cut increased entrepreneurial effort.

When is Effort Contagious in New Venture Management Teams? Understanding the Contingencies of Social Motivation Theory

AbstractConsistent with social motivation theory, prior research on managerial motivation suggests that effort is contagious across management team members. In this study, we draw on belongingness theory to develop a model on important boundary conditions to social motivation theory in the management team context. The model predicts that new venture managers react to their teammates’ higher effort levels by investing higher effort levels themselves primarily when they are confronted with a threat – namely, low venture performance and high environmental hostility – but that effort is less contagious when managers face little threat. We test our model with a sample of 103 new venture managers nested in 51 management teams in a longitudinal setting capturing managerial effort over 26 weeks. While we do not find a direct relationship between teammates’ effort and a new venture manager’s subsequent effort, we find support for the crucial role of threat in triggering the contagion of managerial effort. We discuss the contributions of our study for research on management teams, performance feedback, and entrepreneurial effort in new ventures.