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Sarasvathy, Saras D.

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Boards for a New Venture: Putting Together Boards and Working with Them

This note teaches students at all levels how to establish a board for a new venture, explaining why it is necessary, how to attract the right members, how to compensate them, how to distinguish advisors versus directors, how to deal with board conflicts. ...

Cold Opportunity (A): The Nils Bergqvist Story

Suitable for MBA and executive learners, this case series presents an engaging narrative that prompts students to discuss entrepreneurial thinking. An entrepreneur who loves his native Swedish Lapland uses his natural gift for effectuation to ask What? What next? And What now? As his ventures evolve, students begin to ask themselves how they would master similar challenges to their own entrepreneu ...

Cold Opportunity (B): The ICEHOTEL Story

Suitable for MBA and executive learners, this case series presents an engaging narrative that prompts students to discuss entrepreneurial thinking. An entrepreneur who loves his native Swedish Lapland uses his natural gift for effectuation to ask What? What next? And What now? As his ventures evolve, students begin to ask themselves how they would master similar challenges to their own entrepreneu ...

Cold Opportunity (C): The Absolut ICEBARS Story

Suitable for MBA and executive learners, this case series presents an engaging narrative that prompts students to discuss entrepreneurial thinking. An entrepreneur who loves his native Swedish Lapland uses his natural gift for effectuation to ask What? What next? And What now? As his ventures evolve, students begin to ask themselves how they would master similar challenges to their own entrepreneu ...

Legal Issues for New Ventures: Choice of Lawyer and Choice of Entity

This note discusses the legal issues entrepreneurs must consider as they form their company as a legal entity. In Q&A format, the note concisely defines the types of entity available and discusses when and how to engage a lawyer. ...

New Venture Performance

This note examines the pros and cons of two ways to build new ventures. The former is called causal or predictive, because it depends on accurate predictions and clear goals. The latter is effectual or nonpredictive, and it is extremely stakeholder-dependent and means-driven. It is very tempting to jump to the conclusion that the latter is the better way since it is overwhelmingly preferred by exp ...

Ought to "Can": Questions for an Entrepreneurial Future

This technical note explores the broadening role of entrepreneurship as both an economic and societal force. Students learn that as a distinct problem-solving method, entrepreneurship is teachable and applicable to a wide variety of issues central to human well-being and social improvement. It is akin to the scientific method in its capability to generate both the means to achieve yesterday's ends ...

Taking the Plunge: New Luxury Ventures

Students at all levels explore the psychology of entrepreneurship and new product branding and marketing as a young IBM executive decides whether to become an entrepreneur. He must evaluate his business plan; seek advisors; and decide how much money it will take to get started. His product idea? On-the-go water for dogs. With market research complete and a team of advisors assembled, he must decid ...

The Affordable Loss Principle

Ideal for a study of entrepreneurship as a phenomenon, this note explores the difference between causal models and effectuation. Whereas causal models focus on maximizing returns by selecting optimal strategies, effectuation begins with a determination of how much one is willing to lose and leveraging limited means in creative ways to generate new ends as well as new means. The effectuator then us ...

The Bird-in-Hand Principle: Who I Am, What I Know, and Whom I Know

This technical note explores a framework by which entrepreneurs can evaluate their ideas before going forward based on who they are, what they know, and whom they know. Drawing on frameworks presented in textbooks, trade books, journal articles, periodicals, and on Web sites that claim to predict the feasibility and value of new venture ideas. Figure 1 depicts a simple and useful summary of four k ...

The Entrepreneurial Method: How Expert Entrepreneurs Create New Markets

This note reflects a new focus on "effectuation," the logic behind entrepreneurial expertise, which consists of tacit as well as learnable and teachable aspects of experience that are related to high performance in specific domains. Instead of taking either traits or circumstances as inputs and trying to explain variance in performance, the expertise lens focuses on understanding commonalties acro ...

What Makes Entrepreneurs Entrepreneurial?

This case is designed to train students to recognize the characteristics of entrepreneurial thinking. The author studied the problem-solving process of 30 entrepreneurs from a variety of industries whose companies ranged in value from $200 million to $6.5 billion. Careful analysis revealed a distinct thought process which has been termed "effectual reasoning." The way in which entrepreneurs factor ...
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