Volume 5, Issue 4 -

The theory of entrepreneurship, namely the entrepreneurial value creation theory, explains the entrepreneurial experience in its fullest form, from the entrepreneurial intention and the discovery of an entrepreneurial opportunity, to the development of the entrepreneurial competence, and the appropriation of the entrepreneurial reward (Mishra and Zachary 2014). The theory of entrepreneurship provides in sufficient detail the interiors of the entrepreneurial process using a two-stage value creation framework. In the first stage of venture formulation, the entrepreneur driven by a desire for entrepreneurial reward (i.e., entrepreneurial intention) leverages the entrepreneurial resources at hand to sense an external opportunity (cue stimulus) and effectuate the entrepreneurial competence that is sufficient to move to the second stage. Several ventures fail at this stage. In the second stage of venture monetization, the entrepreneur may acquire external resources such as venture capital or strategic alliance to effect growth. Investors face an adverse selection problem when entrepreneurial ability and venture quality are difficult to ascertain. Entrepreneurs may use incentive signals to secure a higher valuation offer from the investors. A business model design with embedded dynamic capabilities can reconfigure the entrepreneurial competence to create sustained value and appropriate the entrepreneurial reward.

Chandra and Zachary’s recent major book, The Theory of Entrepreneurship: Creating and Sustaining Entrepreneurial Value (2014), offers a comprehensive, multidisciplinary, organizational, psychological, and economic synthesis of entrepreneurial studies. A tour de force, the book seeks a unified perspective on the subject, over against the fragmented and incomplete views found across the diverse literature on this subject. Besides commenting on elements on the book, I encourage the authors and their colleagues take the next step and build a collaborative, interactive research/action process to support their framework. This process would enhance the research understandings already being gained and directly benefit the entrepreneurs and investors who can become better researchers of their own situations and more effective in meeting their own aims. I argue this can be done only by directly challenging current Tayloristic organizational and operational practices in universities. I propose using the principles and practices of action research as a way to accomplish the needed changes.

A pressing question in entrepreneurial research is where opportunities come from. Prior research indicates that some opportunities stem from known parameters and outcomes; some are discovered through engagement with unknown but knowable factors; and others are unknowable until brought into being through a creative process. This paper explores the second and more prevailing view in entrepreneurial research – that individuals discover business opportunity – and examines how high-growth entrepreneurs perceive opportunity through engagement with the world. Survey results, based on responses from 165 women entrepreneurs in high-growth startups, indicate that individuals with a strong discover mindset act and think in ways that support opportunity perception. Coupled with a belief in her abilities, the entrepreneur is more likely to move from opportunity perception to new venture creation. Results from semi-structured interviews with women from the same population elucidate the survey findings and yield implications for entrepreneurial theory and practice.

Current constructivist theorizing relies heavily on causal logics and, therefore, posits that entrepreneurs either pursue or abandon perceived opportunities shortly after their inception. However, findings from effectuation research illuminate less-direct processes involved in the establishment of entrepreneurial ventures. We describe how effectual and causal logics might be integrated by proposing a supplemented model of entrepreneurial opportunity production that features an alternative effectual pathway. In describing this model, we develop six propositions to explain the unique pattern of cognitions and behaviors found among entrepreneurs employing effectual logics. Our propositions suggest that these entrepreneurs are unlikely to rely on peer feedback to determine the viability of early stage opportunities. Instead, they delay the objectification and evaluation of opportunities because they recognize that predictions made in uncertain environments are unlikely to be correct. The employment of these alternate logics results in different pathways to commercialization and different consequences associated with failures.

The growing interest in sustainability has dominated the area of entrepreneurship research. However, the measuring of sustainability factors has been largely ignored. As a result, so far, no researchers have developed sustainability factor scales and this might lead to a question of scale validity. This paper attempts to fill this gap: the aim of this study is to develop and validate scales of sustainability factor by investigating a microenterprise from the informal sector. In its design, the study uses a mixed method research approach. In the qualitative phase, content analysis has been applied to analyse the transcribed field study interviews. This procedure explores and confirms the sustainability variables and factors. The quantitative data are analysed through Exploratory Factor Analysis (EFA) followed by Partial Least Square (PLS) approach. Quantitative analysis then validates the variables and factors. The study then specifies scales of sustainability factors in the context of an informal microenterprise and assesses them as reflective in nature. The limitations of the study are then identified and thoughts to stimulate future investigations discussed.