Entrepreneurship Theories

Could one become addicted to the idea of being an entrepreneur? Countries vary in terms of how their people view entrepreneurs, and entrepreneurship as a career path. In some places, entrepreneurship may be viewed negatively, or associated with corruption. However, the prevailing view of the entrepreneur in the Western Media is the heroic entrepreneur meme. These are often outsiders that manage to disrupt incumbencies and are associated with ideas such as democracy, freedom, and liberty. Perhaps the positive view of the practice has led to entrepreneurship becoming as a desirable pursuit for individuals searching for a lifestyle and character to identity with. These types of individuals have been given names over time including the "Wantrepreneur", Veblenian Entrepreneur or "Untrepreneur". These labels refer to individuals who pursue entrepreneurship not with innovative intentions, or a desire to solve a problem, or to satisfy a need--but solely to live the lifestyl

What is a Born Open Startup? A startup that is born open is one that rejects the notion of proprietary knowledge appropriation (e.g,. obtaining patents ). In fact, software patents are probably the born open crowd's worst abomination.   Instead, a born open startup views itself as a part of a ecosystem of firms that work cooperatively and competitively. They typically are autonomous but have some interconnected goals. Open source startups participate in the development of a community of firms with a shared governing policy to prevent the appropriation of the technology. According to Mekki MacAulay, " Open strategy involves the collective production of a shared good in an open fashion such that the resulting product is available to all, including competitors. In the case of open entrepreneurship, 'born-open' startups are entrepreneurial ventures whose business models are designed specifically based around a collective good. Such business models can be effectiv

Distinct from the popular medical/psychological definition of generativity, which defines the concept as a need to nurture and guide younger people and contribute to the next generation, the generativity theory in relation to entrepreneurship focuses on the development of technology stemming from the foundations set by previous innovations. According to Zittrain (2006, p. 1980) generativity refers to “technology’s overall capacity to produce unprompted change driven by large, varied, and uncoordinated audiences”. The keyword here being ‘unprompted’. Zittrain suggests that the innovations and outcomes are unintentional and occur without purposeful intent. He also notes that the outcomes of these activities in turn become the basis for future innovation. Yoo et al. (2010) expands on Zittrain’s definition and illustrates generativity as a layered model where innovation on one layer’s technology can have a cascading effect on other layers. An example of this is a camera using available

Another biological theory is the childhood adversity theory. While researchers have looked at resilience in adults, few have examined the how childhood adversity may affect entrepreneurial intentions.  Using a variant of the underdog theory, which looks at how negative experience shape an individual's resilience. Recent research has looked at samples of entrepreneurs from the Great Chinese Famine of 1959–1961 and war-torn Vietnam. Both studies find that individuals who endured childhood adversity are more likely to become entrepreneurs.  Both paper use the ‘underdog’ theory of entrepreneurship proposed by Miller and Le Breton-Miller (2017). The gist of the underdog theory is that "negative personal circumstances of an economic, sociocultural, cognitive, and physical/emotional nature may have a … powerful role to play in getting people to become effective entrepreneurs" (p. 3). The theory suggest that life challenges require the development of coping and adaptive skil

The architectural innovation theory of entrepreneurship focuses on changes in product architecture and their advantages/disadvantages for incumbents and new entrants ( Henderson and Clark, 1990 ). The bottom line of the theory for entrepreneurs is that a type of innovation called "architectural innovation", is a promising avenue for new entrant to pursue because it is difficult for incumbent to pursue. The theory starts with the basic idea that a product or service is made up of components that fit together according to some type of design called "product architecture" (Ulrich, 1995). For instance, a bus architecture uses a single point of contact for all the components to connect to. A slot architecture has a unique connector for each type of component. In a sectional architecture, components can be physically arranged in a number of different ways. Modular architectures are those which make it possible to isolate the development of components by standardizing thei

Competence destroying innovations are expected to be brought to market more successfully by new entrants than competence enhancing innovations ( Tushman & Anderson, 1986 ).  Competence = abilities + resources An incumbent firm's competence is destroyed when a technological innovation obsolesces the abilities and or resources that previously composed the competences of the firm. For instance, Blockbuster's retail competence was undermined by Netflix's online model .  The theory goes that incumbents are reluctant to adopt competence destroying innovations because they prefer to preserve and enhance their existing competences. Besides, developing new competences often means shedding the old and that can involved painful layoffs or divestitures . These difficult organizational changes and the coalitions that form within organizations to try to stop them, create a friction that impairs adoption. Instead, the new entrant benefits from adopting competence-destroying innovation

Actor-network theory was created by Bruno Latour , Michel Callon , and John Law . It describes a “material-semiotic" method of analysis that is distinct from mainstream network analysis in that it includes non-human objects in networks as nearly equally important as human actors. According to Latour (1999) : “You are different with the gun in your hand; the gun is different with you holding it. You are another subject because you hold the gun; the gun is another object because it has entered into a relationship with you.” According to Korsgaard (2011) , Latour’s point is that neither the gun nor the person kills alone, but the combination of person and gun can execute the sinful act. The conclusion is that human agency is not merely a human phenomenon, because it relies on non-human elements too be executable. Korsgaard applied actor-network theory (ANT) to entrepreneurship. He argues that ANT is superior to the older ‘ discovery theories ’ that have dominated the entrep

Serial entrepreneurship refers to the repeated behaviors of entrepreneur—“There are two types of entrepreneurs: novice entrepreneurs, who launch a business for the first time, and habitual entrepreneurs, which include serial entrepreneurs, who launch businesses sequentially, and portfolio entrepreneurs, who run multiple businesses concurrently.” [1]   Plehn-Dujowich suggests that serial entrepreneurs differ substantially from first time entrepreneurs. They argue that the serial entrepreneurs develop new capabilities over time that makes them more effective entrepreneurs. For instance, they may develop heuristics that guide their decision processes that reduce the analysis task needed to assess risks. These types of advantage lead to equal or higher success rates for serial entrepreneurs and a higher likelihood of sticking to entrepreneurship as a career choice. Serial entrepreneurship theory starts with the idea that entrepreneurs need to decide whether to stay in business, l

Could your physiology make you more entrepreneurial? Research examining the physiology of entrepreneurs is rather new and underdeveloped. Very little is known about how our physiology can affect our propensity for entrepreneurship. One study examined how testosterone level experienced in the womb can affect us. Testosterone exposure in utero is linked to competitiveness, aggressiveness, and other traits that have been linked to some extend with entrepreneurs. [1]   The researchers used a technique of measuring finger length ratios that are markers of testosterone exposure. Survey respondents where supplied with rulers and instructions and self-reported the lengths of their index and ring fingers. To calculate the ratio (2D:4D), one divides the length of the index finger by the length of the ring finger on the same hand. A higher ratio (i.e., relatively long index finger) is associated with many different traits including sexuality, aggressiveness, assertiveness, unprovo