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Talk about the future of entrepreneurship research. Credit to Steve Blank for some of the ideas here.
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Technology Entrepreneurship
Chuck EesleyManagement Science & Engineering
Stanford University
The Story of 4 Dinners, 3 big ideas, and a President
3 Points for the Future
1. Experimentation
2. Unique to scalable, technology-based startups?
3. Technology Entrepreneurship outside the US? (policies, institutions, culture)
Dinner #1
To Jobs . . .
… Not you, Steve.
Any ideas on how to create a few million new jobs?
FarmVille subsidies?
E&I?
E-Lab?
G-Lab?
D-Lab?
I-Teams?
What’s with the short names???
Dinner #2
Arnold Cooper
Fiona Murray
A. SaxenianT. Stuart
Diane Burton
Ed Roberts
S. Shane
K. Eisenhardt
D. Hsu
M. Cusumano
In the early 1960s, studies of tech. e-ship began with my work on MIT-related firms and Cooper’s work on Silicon Valley…
Most looked at entrepreneur characteristics.
We dug into the firm-level.
Fiona and Toby looked at networks, AnnaLee at culture, Diane at TMT and org. modes, Kathy did decision making, David looked at entrep. finance, Michael at software.
Where have we been?
• Began in early 1960s with Roberts, MIT-related spin-offs, Arnold Cooper, Silicon Valley co’s
Who becomes an entrepreneur?
• Relatively small lit on tech-based e-ship
But how do I get my millions of new jobs?
How am I supposed to use this to create a few million new jobs?
Let’s try a different group for dinner.
Dinner #3
Big Idea #1
Risk, Failure, and Experimentation
Experimentation
Which piece of the model to test first?
ExperimentationThis is something we should have a lot to say about!
Theory• Startups = Economic and social experiments
– How do founders “theorize”? What improves theorizing?– Convince others of their findings?– Learn faster?
Scientific method analogy• Experimentation/Iteration – search for scalable business model
– What experiments to run first?– Implications for founders + Private Co. Boards– Separate: Idea, execution, resource acquisition
Experimentation
Methods – experiments, mobile/web, incubator• Understand causal impact of strategic choices, networks,
skills
• Intermediate data– User acquisition costs– Viral coefficient– Customer lifetime value– Monthly burn rate– Product/market fit– Average selling price
But the success rate is so low . . .
Big Idea #2
Most lit not on tech. entrepreneurship
Big Idea #2
• Finding new markets and business opportunities:– Stumbling around effectively with probing, real time
information and some luck
• Shaping new markets and businesses:– Claiming, demarcating and controlling
• Demarcating industry architecture:– Advocating an architecture, joining would-be partners,
probing key uncertainties
• Innovative, technology-based entrepreneurship – why different, why important?
Fundamental differences with Large Co
Phenomenon Importing Theory (Context) Novel Theory
And they are NOT small versions of large companies
William C. Durant vs. Alfred P. SloanE-school vs. B-school
How am I supposed to use this to create a few million new jobs and compete internationally?
Let’s try a different group for dinner.
Dinner #4
Big Idea #3
Big Idea #3
Setting the Table(for entrepreneurs)
Not this table
Big Idea #2
Barriers to growthNon-competes,
Michigan
Financial intermediaries
Big Idea #3Just like a good dinner party . . .
• High tech, high growth entrepreneurship– Institutions, property rights, universities, basic R&D,
contract enforcement, etc. – Also, informal institutions, social norms, practices . . .
(StartupChile)
• Strategies in different environments– Bubble vs. downturn
3 Revolutions That Will Change Entrepreneurship Research
What lies ahead?
Takes revolution in the world to drive revolution in academic research
• Computer revolution, Dotcom boom
3 revolutions that will drive the coming years of tech. entrepreneurship research– Web/mobile/accelerator revolution – petri dish/fruit fly – New engineering-based industries– Globalization
Mobile internet
Clean tech & similar technologies
Globalization
In Closing
Have to get outside of traditional management/strategy ways of thinking
• E-school vs. B-school• Durant vs. Sloan
3 Points for the Future
1. Experimentation as model for process of building a successful, innovative firm
2. What is unique to scalable, technology-based startups (not small business)?
3. Technology Entrepreneurship outside the US? (policies, institutions, culture)
What lies ahead?
• Academics are lagging behind the theorizing of practitioners– Models of Entrepreneurial Performance– Search for scalable business model
• Many say opportunity recognition, but may not be possible - Disentangle good idea from execution
• Long R&D cycle vs. web/app startups• Theory and Methods – experiments, mobile/web,
incubator– Intermediate data