Toward Deliberate Practice in the Development of Entrepreneurial Expertise: The Anatomy of the Effectual Ask

Dew, Nicholas; Ramesh, Anusha; Read, Stuart; Sarasvathy, Saras D.

doi:10.1017/9781316480748.022

Cited by 28 publications

(27 citation statements)

References 78 publications

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“…These can aid in the assessment of risks involved in venture creation activities. They can also guide the formation of the network of stakeholders and inform how to control the outcomes of a particular endeavor (Dew et al 2018;Read et al 2016).…”

Section: 1mentioning

confidence: 99%

Comparing effectuation to discovery-driven planning, prescriptive entrepreneurship, business planning, lean startup, and design thinking

2019

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There has been a growing interest among entrepreneurs and students in explicit guidance for entrepreneurial action. Both scholars and practitioners have responded to this demand by suggesting a variety of entrepreneurial methods. This has led, however, to a proliferation of relatively unrelated methods with varying degrees of rigor and relevance. In an attempt to organize and bring clarity to the range and diversity of entrepreneurial methods, this article compares effectuation with five other entrepreneurial methods along nine conceptual dimensions. Through the application of two conceptual frameworks, core underpinnings of each method are highlighted. In addition to revealing similarities and differences between the methods, the study identifies some key implications for theory, practice, policy, and education. The strengths of effectuation on a theoretical level could be used to develop other entrepreneurial methods. Conversely, the strengths of other entrepreneurial methods could be used to shore up the potential weaknesses of effectuation, such as a lack of behavioral tactics and limited applicability in later stages of venture development. Findings from this article can thus aid entrepreneurship scholars and practitioners to improve their prescriptions and can create new avenues for developing entrepreneurial methods.

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Section: 1mentioning

confidence: 99%

Comparing effectuation to discovery-driven planning, prescriptive entrepreneurship, business planning, lean startup, and design thinking

2019

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“…Also, worthy of further investigation is that 25% get funded in eight months or less from conception. If, as a nascent entrepreneur, you have more than two-thirds of a chance of acquiring external funding, provided you ask, when surely it is well worth it, and it strongly supports the importance of asking more broadly in understanding what entrepreneurs do (Dew et al , 2018).…”

Section: Discussionmentioning

confidence: 95%

Ready or not? Nascent entrepreneurs’ actions and the acquisition of external financing

Warhuus

Frid

Gartner

2021

IJEBR

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PurposeThis study offers empirical evidence from a nationally representative panel dataset of nascent entrepreneurs (PSED-II) regarding when external financing is acquired and how certain factors affect this timing during the cumulative process of nascent entrepreneurs taking actions toward establishing an operational entity. By assessing the relationship between the external financing event and the cumulative set of actions that nascent entrepreneurs undertake to create new businesses, we improve our understanding of how the timing of acquiring external financing affects organizational survival and growth.Design/methodology/approachWe apply nonparametric and semiparametric survival analysis techniques to a nationally representative panel dataset of nascent entrepreneurs. This ascertains the probability of an external financing event at any given moment in time and a set of startup conditions that we hypothesize will affect this timing. First, we use Kaplan–Meier analysis to explore when external financing occurs during new business creation. We then use discrete-time survival analysis to investigate whether certain startup conditions affect when external financing occurs. Finally, we conduct a test of independence to examine the external financing event relative to other startup activities completed during new business creation.FindingsNascent entrepreneurs tend to acquire external funding relatively late in the new venture startup process – on average, about two-thirds of the way from conceiving of the idea and becoming operational. They tend to take actions that are less resource-demanding early in the startup process to build their organizations to a fundable stage. Net worth tends to speed up the acquisition of external funding as wealthy entrepreneurs tend to ask for funding earlier in the process. Finally, entrepreneurs in capital-intensive industries do not seem to get outside funding before entrepreneurs in other industries.Originality/valueThis study is unique in three ways. First, we investigate the timing of the highly important external financing event. Timing is critical in unpacking and making sense of the very early stages of a new business and in guiding entrepreneurs and students about when to do what. Second, we do so in a subsample of preoperational, nascent, funded entrepreneurs derived from a nationally representative panel dataset of startup attempts. Third, our findings provide a counter-intuitive yet systematic understanding of organizational emergence and very early-stage financing.

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“…Our primary sources are , which introduced the term effectuation in a major academic journal, and Sarasvathy (2008), a book discussing the primary effectuation concepts, methods and data used to generate the concepts and the pragmatist philosophy argued to underpin effectuation. We also draw on conceptual works that discuss a range of overlapping issues, including the nature of entrepreneurial expertise (Dew et al, 2009a(Dew et al, , 2018Read and Sarasvathy, 2005;Sarasvathy, 2001b); alternative logics of decision-making (Sarasvathy and Dew, 2005a); the distinctive character of effectual reasoning (Dew et al, 2009b;Sarasvathy and Wiltbank, 2010); the creation of new firms and markets (Sarasvathy, , 2004aDew et al, 2011;Dew and Sarasvathy, 2016;Sarasvathy and Dew, 2005b); firm/organisation design (Sarasvathy, 2004b(Sarasvathy, , 2012Sarasvathy et al, 2008); a behavioural theory of the entrepreneurial firm (Dew et al, 2008), and the implications of effectuation concepts for strategic management (Venkataraman and Sarasvathy, 2001), innovation (Dew and Sarasvathy, 2007) and marketing (Read et al, 2009b). Two editions of a textbook illustrate the core concepts using real-life examples (Read et al, 2011(Read et al, , 2017.…”

Section: Methodological Approach: Analysing Effectuation Conceptsmentioning

confidence: 99%

Contesting effectuation theory: Why it does not explain new venture creation

Kitching

Rouse

2020

International Small Business Journal: Researching Entrepreneurs

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We evaluate whether the theory of effectuation provides – or could provide – a powerful causal explanation of the process of new venture creation. We do this by conducting an analysis of the principal concepts introduced by effectuation theory. Effectuation theory has become a highly influential cognitive science-based approach to understanding how nascent entrepreneurs start businesses under conditions of uncertainty. But by reducing the process of venture creation to a decision-making logic, effectuation theory pays insufficient regard to the substantial, pervasive and enduring influence of social-structural and cultural contexts on venture creation. Powerful explanations should conceive of venture creation as a sociohistorical process emergent from the interaction of structural, cultural and agential causal powers and must be able to theorise, fallibly, how nascent entrepreneurs form particular firms in particular times and places. We conclude that effectuation’s contribution to entrepreneurship scholarship is more limited than its advocates claim because it can offer only an under-socialised, ahistorical account of venture creation. Failure to theorise adequately the influence of structural and cultural contexts on venture creation implicitly grants nascent entrepreneurs excessive powers of agency.

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Toward Deliberate Practice in the Development of Entrepreneurial Expertise: The Anatomy of the Effectual Ask

Cited by 28 publications

References 78 publications

Comparing effectuation to discovery-driven planning, prescriptive entrepreneurship, business planning, lean startup, and design thinking

Comparing effectuation to discovery-driven planning, prescriptive entrepreneurship, business planning, lean startup, and design thinking

Ready or not? Nascent entrepreneurs’ actions and the acquisition of external financing

Contesting effectuation theory: Why it does not explain new venture creation

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