Entrepreneurship →
- 18 Aug 2011
- Lessons from the Classroom
Business Plan Contest: 15 Years of Building Better Entrepreneurs
Since 1997, Hundreds of student-entrepreneurs have tested their ideas at Harvard Business School's annual Business Plan Contest. Here is what they have learned about success, failure, and themselves. From the HBS Alumni Bulletin. Open for comment; 0 Comments.
- 11 Aug 2011
- Lessons from the Classroom
Perfecting the Project Pitch
Entrepreneurs may be great innovators, but not necessarily great presenters. Associate Professor Thomas Steenburgh teaches them the fine art of product pitching. Key concepts include: Crafting a compelling product pitch can be a difficult process for entrepreneurs who have a technical, engineering, or non-sales background, or another non-sales discipline. A pitch can go awry when the presenter gets too wrapped up in details rather than concentrating on the central idea, or has not thought through the idea enough to really understand it. An audience will give presenters 60 seconds to capture their attention—then they tune out. A key for entrepreneurs pitching their plans is to show passion for the idea and for the audience. Open for comment; 0 Comments.
- 27 Jul 2011
- Working Paper Summaries
With a Little Help from My (Random) Friends: Success and Failure in Post-Business School Entrepreneurship
While starting a new company usually requires an independent spirit and self-sufficient nature, the decision to jump into entrepreneurship is often influenced by the acts of others. In this paper, Josh Lerner and Ulrike Malmendier explore how the entrepreneurial tendencies of peers affect not only one's decision to start a company, but whether that company will succeed. The researchers use data from a decade of first-year class sections at Harvard Business School. Key concepts include: A higher share of students with a pre-MBA entrepreneurial background in any given section leads to lower rates of post-MBA entrepreneurship among students without an entrepreneurial background. But this "discouragement effect" is narrowly focused: students in sections with more pre-MBA entrepreneurs are less likely to start unsuccessful ventures, but equally (if not more) likely to start successful ones. Sections with few prior entrepreneurs have a considerably higher variance in their rates of unsuccessful post-MBA entrepreneurship. Closed for comment; 0 Comments.
- 11 Apr 2011
- Lessons from the Classroom
Teaching a ‘Lean Startup’ Strategy
Most startups fail because they waste too much time and money building the wrong product before realizing what the right product should have been, says HBS entrepreneurial management professor Thomas R. Eisenmann. Closed for comment; 0 Comments.
- 31 Mar 2011
- Research & Ideas
From SpinPop to SpinBrush: Entrepreneurial Lessons from John Osher
At a panel discussion on entrepreneurship, professor William A. Sahlman and several successful start-up veterans discussed the case of John Osher, father of Dr. John's Products, Ltd., and the wildly popular battery-powered toothbrush, the SpinBrush. Key concepts include: Look for gaps in the existing market or product lines to exploit. Anticipate product knockoffs and plan accordingly. Raise money when you don't need it, so you'll have it when you do. Be quick to market with the initial product and improve as you go along. Closed for comment; 0 Comments.
- 07 Mar 2011
- Research & Ideas
Why Companies Fail—and How Their Founders Can Bounce Back
Leading a doomed company can often help a career by providing experience, insight, and contacts that lead to new opportunities, says professor Shikhar Ghosh. Closed for comment; 0 Comments.
- 07 Feb 2011
- Lessons from the Classroom
Creating the Founders’ Dilemmas Course
In HBS professor Noam Wasserman's second-year MBA course, Founders' Dilemmas, students study quandaries that virtually all entrepreneurs face when trying to realize the dream of launching a startup—from deciding when to start the company to learning how to make a graceful exit. Guest speakers discussing their experiences include All-Star pitcher-turned-entrepreneur Curt Schilling and Tom & Tom, the Nantucket Nectars guys. Closed for comment; 0 Comments.
- 18 Oct 2010
- Lessons from the Classroom
Venture Capital’s Disconnect with Clean Tech
Clean-tech start-ups depend on patience and public policy to thrive—the Internet models for VC funding don't apply. That's why Harvard Business School professor Joseph Lassiter is making an unusual recommendation to his entrepreneurship students: Spend a few years serving time in a government job. Key concepts include: MBA students and young venture capitalists often assume that all promising start-ups can grow and exit as fast as Internet start-ups, but they're mistaken. Clean-tech start-ups are often stymied by a "valley of death"—that precarious stage between researching and developing a product and going to market. The success of clean-tech companies often is dependent on public policy, so it behooves budding VCs and entrepreneurs to spend a few years learning the ropes in a government or corporate job. Closed for comment; 0 Comments.
- 15 Sep 2010
- Working Paper Summaries
From Bench to Board: Gender Differences in University Scientists’ Participation in Commercial Science
Does gender affect whether a university scientist will be invited to work with for-profit companies? Indeed it does. A new paper finds that male professors receive more opportunities than their female counterparts to join scientific advisory boards and start new companies. Research, focusing on the biotechnology field, was conducted by Haas School of Business professor Waverly W. Ding, MIT Sloan professor Fiona Murray, and HBS professor Toby E. Stuart. Key concepts include: University-employed scientists helped to found at least half of the publicly traded biotech firms in existence today. Women scientists receive far fewer invitations than men to join scientific advisory boards, and so male scientists are more than twice as likely as female scientists to become formal board advisors. When female scientists do receive invitations to join boards, they generally come from small start-ups with limited financial backing, rather than from high-profile companies backed by high-status venture capitalists. The corporate gender gap increases among scientists employed at elite universities or academic departments. However, the gender gap decreases at schools with formal technology transfer offices, indicating that institutional support can help women overcome obstacles to entry into commercial science. Closed for comment; 0 Comments.
- 02 Aug 2010
- Research & Ideas
Modern Indian Art: The Birth of a Market
Before 1995, there was little market for twentieth-century Indian fine art. That's when artists, auction houses, critics, and others defined a new product category—modern Indian fine art—resulting in worldwide demand and soaring prices. Professor Mukti Khaire explains the dynamics behind new market categories. Closed for comment; 0 Comments.
- 21 Jun 2010
- Research & Ideas
Strategy and Execution for Emerging Markets
How can multinationals, entrepreneurs, and investors identify and respond to new challenges and opportunities around the world? In this Q&A, HBS professors and strategy experts Tarun Khanna and Krishna G. Palepu offer a practical framework for succeeding in emerging markets. Plus: Book excerpt with action items. Key concepts include: The ambition level of large, fast-growing emerging markets around the world rivals that of companies in the United States in the late 19th and early 20th centuries. Khanna and Palepu outline how to identify and respond to institutional voids in product, labor, and capital markets. Investors and entrepreneurs can respond to niches in institutional infrastructure in the private sector, such as the need for information analyzers and advisors, aggregators and distributors, transaction facilitators, and more. A useful starting point for managers is to construct an institutional map to identify institutional voids—which may themselves present business opportunities. Western multinational companies as well as local entrepreneurs are innovating products to attract the emerging middle class. Such innovations could potentially benefit consumers living in mature markets. Closed for comment; 0 Comments.
- 15 Apr 2010
- Working Paper Summaries
The Consequences of Entrepreneurial Finance: A Regression Discontinuity Analysis
What difference do angel investors make for the success and growth of new ventures? William R. Kerr and Josh Lerner of HBS and Antoinette Schoar of MIT provide fresh evidence to address this crucial question in entrepreneurial finance, quantifying the positive impact that angel investors make to the companies they fund. Angel investors as research subjects have received much less attention than venture capitalists, even though some estimates suggest that these investors are as significant a force for high-potential start-up investments as venture capitalists, and are even more significant as investors elsewhere. This study demonstrates the importance of angel investments to the success and survival of entrepreneurial firms. It also offers an empirical foothold for analyzing many other important questions in entrepreneurial finance. Key concepts include: Angel-funded firms are significantly more likely to survive at least four years (or until 2010) and to raise additional financing outside the angel group. Angel-funded firms are also more likely to show improved venture performance and growth as measured through growth in Web site traffic and Web site rankings. The improvement gains typically range between 30 and 50 percent. Investment success is highly predicated by the interest level of angels during the entrepreneur's initial presentation and by the angels' subsequent due diligence. Access to capital per se may not be the most important value-added that angel groups bring. Some of the "softer" features, such as angels' mentoring or business contacts, may help new ventures the most. Closed for comment; 0 Comments.
- 31 Mar 2010
- Working Paper Summaries
When Open Architecture Beats Closed: The Entrepreneurial Use of Architectural Knowledge
Entrepreneurial firms rich in knowledge but poor in other resources can use superior architectural knowledge of a technical system to gain strategic advantage over larger and better endowed rivals. This paper presents a model and provides examples showing that architectural knowledge can be applied strategically to change a firm's scope and boundaries, make innovations more or less autonomous, and change the span of problems it must solve. Key concepts include: Architectural knowledge is knowledge about the components of a complex system and how they are related. Architectural knowledge includes knowledge about how the system performs its functions; how the components are linked together; and the behavior of the system, both planned and unplanned, in different environments. For a small entrepreneurial firm with limited financial resources facing larger rivals, the most valuable architectural knowledge pertains to bottlenecks and remodularizations that isolate the bottlenecks. Such knowledge can form the basis of a small footprint technical architecture that delivers an ROIC (higher return on invested capital) advantage. Technical systems that are susceptible to remodularization around bottlenecks are strategic targets of opportunity for entrepreneurial firms. Incumbents risk being displaced by smaller rivals with superior architectural knowledge leading to an ROIC advantage. Closed for comment; 0 Comments.
- 06 Jan 2010
- What Do You Think?
Is a Stringent Climate Change Agreement a Pot of Gold?
Reading this month's comments, HBS professor Jim Heskett wonders if we even need a climate change agreement as a catalyst to foster innovation and the VC investment required to support it. (Online forum has closed; next forum opens February 4.) Closed for comment; 0 Comments.
- 07 Dec 2009
- Research & Ideas
Government’s Positive Role in Kick-Starting Entrepreneurship
The U.S. government has spent billions of dollars bailing out troubled companies. Is it time for Uncle Sam to invest in new entrepreneurial firms as well? Professor Josh Lerner makes the case for limited government involvement in his book Boulevard of Broken Dreams. Closed for comment; 0 Comments.
- 09 Nov 2009
- Research & Ideas
Come Fly with Me: A History of Airline Leadership
A new book looks at the history of the U.S. aviation industry through the eyes of its entrepreneurs, managers, and leaders—men like Pan Am's Juan Trippe and Southwest Airlines' Herb Kelleher—each emerging at different stages of the industry's evolution from start-up to rebirth. Who comes next? An interview with coauthor Anthony J. Mayo. Key concepts include: While disruptive forces can change an industry, so too can leaders themselves by the manner in which they run their enterprises. Different archetypes of leaders emerged as the U.S. airline industry evolved from start-up phase through deregulation and the shock of September 11, 2001. Airlines seem ripe for a new form of leadership to reenergize the industry. Closed for comment; 0 Comments.
- 08 Oct 2009
- Working Paper Summaries
Clusters of Entrepreneurship
Economic growth is highly correlated with an abundance of small, entrepreneurial firms. This relationship is even stronger looking across industries within cities, and has been taken as evidence for competition spurring technological progress, product cycles where growth is faster at earlier stages, and the importance of entrepreneurship for area success. Any of these interpretations is possible, however, and the only thing that we can be sure of is that entrepreneurial clusters exist in some areas but not in others. This paper first documents systematically some basic facts about average establishment size and new employment growth through entrepreneurship, then analyzes entry and industrial structures at the region and the city levels using the Longitudinal Business Database. Key concepts include: There is a remarkably strong correlation between smaller average firm size and subsequent employment growth due to start-ups. Evidence does not support the view that regional differences in demand for entrepreneurship are responsible for these entrepreneurial clusters. Instead, the evidence suggests that spatial differences in the fixed costs of entrepreneurship and/or in the supply of entrepreneurs best explain cluster formation. Closed for comment; 0 Comments.
- 11 Sep 2009
- Working Paper Summaries
Financing Constraints and Entrepreneurship
Financing constraints are one of the biggest concerns impacting potential entrepreneurs around the world. Given the important role that entrepreneurship is believed to play in the process of economic growth, alleviating financing constraints for would-be entrepreneurs is also an important goal for policymakers worldwide. In this paper HBS professors William R. Kerr and Ramana Nanda review two major streams of research examining the relevance of financing constraints for entrepreneurship. They then introduce a framework that provides a unified perspective on these research streams, thereby highlighting some important areas for future research and policy analysis in entrepreneurial finance. Key concepts include: Promoting entrepreneurship is an important goal of many governments, and researchers need to define for policymakers a more unified perspective for how studies and samples fit together. The "slice" of entrepreneurship examined is very important for the appropriate positioning of research on financing constraints, but studies too often fail to consider this dimension in the conclusions drawn from empirical results. The framework presented here is useful for thinking about the appropriate role of public policy in stimulating entrepreneurship. Closed for comment; 0 Comments.
- 11 Sep 2009
- Working Paper Summaries
Banking Deregulations, Financing Constraints and Firm Entry Size
How do financing constraints on new start-ups affect the initial size of these new firms? Since bank debt comprises the majority of U.S. firm borrowings, new ventures are especially sensitive to local bank conditions due to their limited options for external finance. Liberalization in the banking sector can thus have important effects on entrepreneurship in product markets. As HBS professors William Kerr and Ramana Nanda explain, the 1970s through the mid-1990s was a period of significant liberalization in the ability of banks to establish branches and to expand across state borders, either through new branches or through acquisitions. Using a database of annual employment data for every U.S. establishment from 1976 onward, Kerr and Nanda examine how U.S. branch banking deregulations impacted the entry size of new start-ups in the non-financial sector. This paper is closely related to their prior work examining how the deregulations impacted the rates of startup entry and exit in the non-financial sector. Key concepts include: The average entry size for start-ups did not change following the bank deregulations. However, this result masks the differences in entry size among startups that failed within three years of entry and those that survived for four years or more. Start-ups that survived for four years or longer entered at 2% larger sizes after the deregulations compared to earlier periods. Entrants that failed within three years did not enter at larger firm sizes. It is a challenge to measure accurately changes in the initial size of new firms even using micro-data such as that from the U.S. Census Bureau. Carefully characterizing effects of financing constraints on the initial size of new firms theoretically and empirically is an important research topic for entrepreneurial finance. Closed for comment; 0 Comments.
The Untold Story of ‘Green’ Entrepreneurs
The history of entrepreneurs in green industries is largely unwritten, a fact that Harvard Business School business historian Geoffrey Jones is trying to remedy. In a new paper, Jones explores the edge-of-society pioneers who created the wind turbine industry. Key concepts include: The research looks at entrepreneurs in the fields of organic food, sustainable agriculture, natural cosmetics, the built environment, ecotourism, and waste recycling. The history of green entrepreneurship is largely untold, ignored by both business and environmental historians. Many still think that there were few environmental concerns or green businesses until the last decade. Closed for comment; 0 Comments.