In search of angels: the first bucket of gold for entrepreneurs

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Garrison Hongyu Song ◽  
Ajeet Jain
Keyword(s):  
Early Stage ◽  
Random Search ◽  
Negative Influence ◽  
Model Parameters ◽  
Content Type ◽  
Angel Investor ◽  
Start Up ◽  
Market Search ◽  
Financing Market ◽  
Matching Probability

Purpose This paper aims to explore the allocation of the exit value of a start-up company in market equilibrium between an angel investor and an entrepreneur in the very early-stage financing market. Design/methodology/approach The theoretical model is established based on the two-sided random search theory and the model’s ability to match the empirical data is evaluated via simulation. Findings The model indicates that the allocation of the final investment outcome is not proportional to the initial investments by the angel investor and the entrepreneur. The simulation results show that the continued investment by the entrepreneur and the private benefit acquired by the angel investor have a more profoundly negative influence on the angel investor’s share of the exit value of the start-up company. Moreover, the market search structure represented by the matching probability of an angel investor to an entrepreneur has a more significant impact on the angel investor’s share than the other model parameters. Originality/value The importance of market search friction in the very early-stage financing market is emphasized. The concepts of continued investments and private benefits are introduced and quantified for the first time under the framework of angel investment. The impacts of such model parameters as the matching probability of an angel investor to an entrepreneur, the success rate of a start-up company, the bargaining power of an angel investor and the discount rate on the allocation of the exit value of the start-up company are investigated as well.

scholarly journals The early growth of start-ups: innovation matters. Evidence from Italy

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Raffaele Fiorentino ◽  
Sergio Longobardi ◽  
Alessandro Scaletti
Keyword(s):  
Propensity Score ◽  
Propensity Score Matching ◽  
Firm Growth ◽  
Ad Hoc ◽  
Early Stage ◽  
New Ventures ◽  
Objective Measure ◽  
Content Type ◽  
Start Up ◽  
Start Ups

PurposeDespite the relevance of innovation in entrepreneurship literature, empirical research on the innovation-performance relationship in start-ups is underdeveloped and shows controversial results. To bridge this gap, the aim of this paper is to investigate the role of innovativeness on new venture performance in the early stage of the life cycle.Design/methodology/approachRegression modelling and propensity score matching are used to reveal systematic differences in growth between innovative start-ups (ISUPs) and non-innovative start-ups. We use an ad hoc dataset obtained through merging the financial database AIDA with data from administrative sources (Italian Chambers of Commerce and the Italian Ministry for Economic Development).FindingsThe results show that differences in growth can be explained by the different levels of innovativeness in new ventures. Moreover, unlike in prior studies, the innovation inputs matter more than innovation outputs. Indeed, the results support the idea that innovation policies can contribute to maximising the potential of start-ups.Practical implicationsThe findings provide suggestions for policy makers and entrepreneurs to help firms configure ex ante appropriate actions to support the growth of new ventures in the start-up stage.Originality/valueThis study is the first to use the new objective measure of start-up innovation, available from the Italian LD 221 register. Second, different types of innovation are investigated as antecedents of firm growth. Third, we employ propensity score matching, which favours revealing systematic differences in growth between ISUPs and non-innovative start-ups. Fourth, the results of our study are the first to offer evidence on the effectiveness of the new Italian sustaining ISUPs policy.

Journey's end: a dynamic framework of entrepreneurial processes and capitals relating to early stage business exit

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Richard Hanage ◽  
Pekka Stenholm ◽  
Jonathan M. Scott ◽  
Mark A.P. Davies
Keyword(s):  
Case Studies ◽  
Early Stage ◽  
Theory Building ◽  
Cross Sectional ◽  
Content Type ◽  
Dynamic Framework ◽  
Longitudinal Dynamic ◽  
Start Up ◽  
New Business ◽  
Start Ups

PurposeThe purpose of this paper is to respond to the call by McMullen and Dimov (2013) for a clearer understanding of entrepreneurial journeys by investigating the entrepreneurial capitals and micro-processes of seven young early stage entrepreneurs who all exited their businesses within 3 years of start-up.Design/methodology/approachThe authors analysed empirical data from concurrent in-depth interviews which generated rich longitudinal case studies. Theory-building then led to a proposed “Longitudinal Dynamic Process Framework” of entrepreneurial goals, processes and capitals.FindingsThe framework builds on prior studies by integrating entrepreneurial processes and decisions into two feedback loops based on continuous review and learning. It thereby enhances understanding of the dynamics of new business development and unfolds the early stage ventures entrepreneurs' business exits.Research limitations/implicationsThe findings are based on a small purposive sample. However, the main implication for research and theory is showing how the entrepreneurial capitals are dynamic and influenced by entrepreneurs' environment, and also separating entrepreneurs' personal issues from their business issues.Practical implicationsThe findings challenge some assumptions of policymakers and offer new insights for practitioners and early stage entrepreneurs. These include having more realistic case-studies of the entrepreneurial journey, recognizing the need to be agile and tenacious to cope with challenges, understanding how capitals can interact in complementary ways and that entrepreneurial processes can be used to leverage them at appropriate stages of the start-ups.Originality/valueThe concurrent longitudinal analysis and theory-building complements extant cross-sectional studies by identifying and analysing the detailed processes of actual business start-ups and exits. The proposed framework thereby adds coherence to earlier studies and helps to explain early stage entrepreneurial development, transformation of capitals and business exit.

What does a start-up need to grow? An empirical approach for Italian innovative start-ups

2019 ◽  
Vol 25 (2) ◽  
pp. 376-393 ◽  
Author(s):  
Niccolò Innocenti ◽  
Vincenzo Zampi
Keyword(s):  
Early Stage ◽  
Empirical Approach ◽  
Strategic Choices ◽  
Content Type ◽  
Public Investments ◽  
Start Up ◽  
Italian Provinces ◽  
Start Ups ◽  
D Investment ◽  
External Characteristics

PurposeThe purpose of this paper is to capture the role of internal and external characteristics in favouring the growth of innovative start-ups at an early stage of their life.Design/methodology/approachThe empirical approach of this paper is based on an econometric analysis applied to all Italian innovative start-ups with four and five years of life. Growth is analysed after four and five years from the constitution, depending on internal investments in research and development (R&D), in tangible assets and on characteristics external to the firm (110 Italian provinces) related to industrial variety, specialisation, public investments in R&D, etc.FindingsThe results achieved in this study reveal the importance of internal R&D investment even though there is missing evidence on the relevance of general and government specific R&D investment in the area. Other interesting results concern the importance of the firm’s involvement in the technological specialisation of the area and the need for general variety in technological diversification in the area to favour the growth of start-ups.Practical implicationsThe results imply that entrepreneurs should evaluate carefully their strategic choices in terms of the location of the start-up and the investment in R&D as these could be important factors for the firm’s growth.Originality/valueThis paper is an original attempt to measure the importance of both internal and external characteristics for the growth of start-ups. Moreover, the analysis covers the overall population of a new interesting category of firm, the innovative start-up.

When startups exit: comparing strategies in Europe and the USA

2018 ◽  
Vol 39 (3) ◽  
pp. 26-33 ◽  
Author(s):  
Alessia Pisoni ◽  
Alberto Onetti
Keyword(s):  
Early Stage ◽  
High Growth ◽  
High Tech ◽  
Venture Capitalists ◽  
Content Type ◽  
Early Exit ◽  
Start Up ◽  
The Usa ◽  
Local Companies ◽  
Start Ups

Purpose The purpose of this paper is to present an overview of trends toward start-up exits. Exits represent the “end phase” of the start-up process, at least for the founders and the early investors. For high-growth venture-capital-backed companies, exits are often considered the ultimate goal of building a profitable venture. These ventures are intended from the beginning to harvest the financial value created by the business at some point in the future, and return capital to early investors. Design/methodology/approach The authors tracked 5,744 merger and acquisition transactions that have occurred between European and US tech start-ups since 2012. Data are drawn from CrunchBase, the most comprehensive database of high-tech companies and investors with information on the companies and investors around the world. The authors then compared the trends of acquisitions between European and US companies. Findings Results show that US companies are far more inclined to make acquisitions than European ones. Acquirers of start-ups, both from Europe and the US, prefer to buy local companies. However, recently, US companies have started to show more interest in European start-ups. Thus, signaling that the European start-up ecosystem is growing and becoming more attractive for US buyers. Furthermore, results show that start-up exits typically happen within a few years after a company’s establishment. Research limitations/implications The research does not take into consideration the price of the transaction, or the amount of capital invested by venture capitalists in the high-tech start-ups that have been acquired. Further research should address this specific problem by helping European start-ups understand how to plan the exit phase within few years from establishment. Practical implications The results have important implications both for entrepreneurs/managers and policymakers. Early exit appears to be a global trend among start-ups. This suggests that the exit phase should be properly planned to happen in the very early stage of the start-up process. On the other hand, the research also shows that there is still a gap to be filled in the European start-up ecosystems’ ability to produce exits and create new large innovative companies (the so-called “unicorns”). Originality/value To date, there has been a little research about exits for young high-tech ventures. This paper will attempt to shed new light on this so far under-explored issue by specifically analyzing exits as financial strategy for investors and entrepreneurs.

Entrepreneurial cognition and premature scaling of startups: a qualitative analysis of determinants of start-up failures

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
George C. Joseph ◽  
Nimitha Aboobaker ◽  
Zakkariya K.A.
Keyword(s):  
Decision Making ◽  
Cognitive Biases ◽  
Early Stage ◽  
Self Regulation ◽  
Behavioral Patterns ◽  
Content Type ◽  
Attitude Theory ◽  
Start Up ◽  
Entrepreneurial Cognition ◽  
Start Ups

Purpose This study aims to explore the behavioral patterns of entrepreneurs, their cognitive styles and personality characteristics that can lead to a self-destructive chain of events during the transition from a fledgling business to one capable of long-term, profitable growth. This study adopts the self-regulation attitude theory to uncover the reasons for premature start-up scaling, which will help founders to study on their cognitive biases, emotions and behaviors and make efforts to do what does not come naturally to them. Design/methodology/approach The respondents for this qualitative study were selected from a group of entrepreneurs with extensive experience with technology start-ups that have either failed or succeeded during their development stages. In-depth semi-structured interviews were conducted with eight participants, who were selected through snowball sampling, on the theme of understanding “How do premature scaling mistakes happen?”. Thematic analysis was used to unearth common themes. Findings The results of this study identified the following themes, “comparison,” “emotional over-reaction,” “impatience,” “mistaken customer priorities,” “overestimation” and “overconfidence,” which eventually leads to premature scaling. The underlying decision-making heuristics of entrepreneurs can be identified as engulfed in different cognitive biases and emotions resulting in negative behavioral patterns, as in the case of premature scaling. Of the six themes, “comparison,” “mistaken customer priorities,” “overestimation” and “overconfidence relates to cognitive bias” and “emotional over-reaction” and “impatience” relate to emotional factors. Research limitations/implications The study was made possible with the support of the voluntary participants chosen by purposive and snowballing data sampling. The interviewee and interviewer biases could have also crept in as part of this qualitative approach. The study pertains only to start-ups in the information technology sector and further studies need to be done to generalize the results across industries as well. Practical implications This early-stage underestimation of unexpected obstacles in the entrepreneurship journey necessitates a focus on the entrepreneur too, as much as the concept. In these hectic and fast-paced circumstances, aspiring entrepreneurs must be taught how to deal objectively with themselves and others, as well as think strategically. Leaders who scale do so because they take purposeful measures to overcome their weaknesses through self-discipline, soliciting advice from others and using their right to change their attitude and points of view. Originality/value The study frames the new approach into the entrepreneurial literature, linking it to self-regulation attitude theory and adds to the nascent literature on neuroentrepreneurship which discuss entrepreneurial cognition, decision-making, and entrepreneurial behavior. This study attempted to explore the reasons behind the premature scaling of startups on an individual level. This study is pioneering in exploring the cognitive factors underlying an entrepreneur’s decision that results in premature scaling. This study provides insights for academicians, entrepreneurs and policymakers and helps understand the cognitive journey that leads to premature scaling.

scholarly journals Understanding the accelerator from resources-based perspective

2018 ◽  
Vol 12 (3) ◽  
pp. 258-278 ◽  
Author(s):  
Chul Hyun Uhm ◽  
Chang Soo Sung ◽  
Joo Yeon Park
Keyword(s):  
Early Stage ◽  
Point Of View ◽  
Success Rates ◽  
Access To Resources ◽  
Content Type ◽  
Study Approach ◽  
Start Up ◽  
The Usa ◽  
Start Ups

Purpose This study aims to explore Accelerators and their practices in sustaining start-ups within their innovative programs for these companies based on the resource-based perspective. Moreover, with an ever-increasing demand for Accelerators amongst start-up companies, this study also demonstrates the importance of Accelerators, as it pertains to new venture creation. Design/methodology/approach This research uses an exploratory case study approach to examine a comparative view of leading Accelerator companies in the USA and Korea based on resource support. Findings The results of this study show that there are a number of differences between Accelerators of the two countries in terms of the resources they support for early-stage start-ups. The findings also show some similarities. However, in Korea, the Accelerator landscape is limited, where mentorship, resources and investments are not readily accessible, resulting in low success rates for Korean start-up companies. These limitations have had a negative trickle-down effect when providing entrepreneurs with strong access to resources and investors, which highly affects the success rates of early-stage start-ups. Practical implications In terms of the resource-based theory, this study contributes to the growth of early start-ups by emphasizing the role of the accelerator and suggesting the extent and impact that entrepreneurs have access to resources and investors. Originality/value With significant growth in start-ups around the world, the necessity for start-up funding and mentorship has increased drastically. Start-up companies need various types of assets, systems, knowledge and information to achieve their goals. In Accelerators, start-ups receive all the aforementioned resources while also improving their entrepreneurial skills. Start-up companies have many options in seeking investors who support both tangible and intangible resources to boost growth. While there is a wealth of information on traditional funding methods, there are few studies that shed light on the role of Accelerators from the resource-based point of view.

scholarly journals The effect of metabolism on the course of labor and the postpartum period in highly productive cows

2020 ◽  
Vol 17 ◽  
pp. 00256
Author(s):  
Murat Baimishev ◽  
Sergey Eremin ◽  
Kirill Plemyashov ◽  
Hamidulla Baimishev ◽  
Igor Konopeltsev ◽  
...  
Keyword(s):  
Lipid Metabolism ◽  
Postpartum Period ◽  
Early Stage ◽  
Antioxidant Properties ◽  
Antioxidant Systems ◽  
Dry Period ◽  
Blood Samples ◽  
Start Up ◽  
Significant Difference ◽  
Duration Of Pregnancy

The purpose of the research is to determine the etiopathogenesis of reproductive dysfunction in highly productive cows. For this, one group of cows was formed on the principle of paranalogs in the amount of 37 animals inseminated in the first sexual hunt after calving, followed by taking blood samples from them using the Monovet system, considering the duration of pregnancy. During the start-up period, blood was taken 1–4 days before calving and on the first day after calving. A total of 253 blood samples were examined. Subsequently, depending on the effectiveness of insemination, animals were divided into two groups. The first group included inseminated cows after the first insemination (20 animals), the second group included 17 unfertilized cows after the first insemination. Subsequently, blood was taken from animals considering the course of childbirth and the postpartum period. Blood counts were studied according to generally accepted methods using certified equipment. The study found that at an early stage of pregnancy, cows have a significant difference in lipid metabolism and in their peroxidation, in the state of antioxidant systems compared to unstable animals. In the process of pregnancy development in cows, there is a decrease in the level of total lipids and their class, and the accumulation of products of transoxidation of lipids is reduced. In animals with retention of the placenta, a low lipid metabolism and a higher level of peroxidation were established already in the dry period. After calving, this difference increases. The obtained data can be used to develop an algorithm for the prevention of postpartum complications in cows by using substances with antioxidant properties.

A dynamic simulator for the ergonomics evaluation of powered torque tools for human assembly

2017 ◽  
Vol 37 (1) ◽  
pp. 1-12 ◽  
Author(s):  
Haluk Ay ◽  
Anthony Luscher ◽  
Carolyn Sommerich
Keyword(s):  
Risk Factors ◽  
Joint Torque ◽  
Human Hand ◽  
Model Parameters ◽  
Test Rig ◽  
Musculoskeletal Discomfort ◽  
Data Set ◽  
Content Type ◽  
Working Posture ◽  
Displacement Measurements

Purpose The purpose of this study is to design and develop a testing device to simulate interaction between human hand–arm dynamics, right-angle (RA) computer-controlled power torque tools and joint-tightening task-related variables. Design/methodology/approach The testing rig can simulate a variety of tools, tasks and operator conditions. The device includes custom data-acquisition electronics and graphical user interface-based software. The simulation of the human hand–arm dynamics is based on the rig’s four-bar mechanism-based design and mechanical components that provide adjustable stiffness (via pneumatic cylinder) and mass (via plates) and non-adjustable damping. The stiffness and mass values used are based on an experimentally validated hand–arm model that includes a database of model parameters. This database is with respect to gender and working posture, corresponding to experienced tool operators from a prior study. Findings The rig measures tool handle force and displacement responses simultaneously. Peak force and displacement coefficients of determination (R2) between rig estimations and human testing measurements were 0.98 and 0.85, respectively, for the same set of tools, tasks and operator conditions. The rig also provides predicted tool operator acceptability ratings, using a data set from a prior study of discomfort in experienced operators during torque tool use. Research limitations/implications Deviations from linearity may influence handle force and displacement measurements. Stiction (Coulomb friction) in the overall rig, as well as in the air cylinder piston, is neglected. The rig’s mechanical damping is not adjustable, despite the fact that human hand–arm damping varies with respect to gender and working posture. Deviations from these assumptions may affect the correlation of the handle force and displacement measurements with those of human testing for the same tool, task and operator conditions. Practical implications This test rig will allow the rapid assessment of the ergonomic performance of DC torque tools, saving considerable time in lineside applications and reducing the risk of worker injury. DC torque tools are an extremely effective way of increasing production rate and improving torque accuracy. Being a complex dynamic system, however, the performance of DC torque tools varies in each application. Changes in worker mass, damping and stiffness, as well as joint stiffness and tool program, make each application unique. This test rig models all of these factors and allows quick assessment. Social implications The use of this tool test rig will help to identify and understand risk factors that contribute to musculoskeletal disorders (MSDs) associated with the use of torque tools. Tool operators are subjected to large impulsive handle reaction forces, as joint torque builds up while tightening a fastener. Repeated exposure to such forces is associated with muscle soreness, fatigue and physical stress which are also risk factors for upper extremity injuries (MSDs; e.g. tendinosis, myofascial pain). Eccentric exercise exertions are known to cause damage to muscle tissue in untrained individuals and affect subsequent performance. Originality/value The rig provides a novel means for quantitative, repeatable dynamic evaluation of RA powered torque tools and objective selection of tightening programs. Compared to current static tool assessment methods, dynamic testing provides a more realistic tool assessment relative to the tool operator’s experience. This may lead to improvements in tool or controller design and reduction in associated musculoskeletal discomfort in operators.

Quality of life in breast cancer sufferers

2016 ◽  
Vol 29 (7) ◽  
pp. 721-732 ◽  
Author(s):  
Ahmed Essmat Shouman ◽  
Nahla Fawzy Abou El Ezz ◽  
Nivine Gado ◽  
Amal Mahmoud Ibrahim Goda
Keyword(s):  
Breast Cancer ◽  
Quality Of Life ◽  
Family Income ◽  
Early Stage ◽  
Functional Domain ◽  
Related Factors ◽  
Specific Patient ◽  
Content Type ◽  
Factors Affecting

Purpose – The purpose of this paper is to measure health-related quality of life (QOL) among patients with early stage cancer breast under curative treatment at department of oncology and nuclear medicine at Ain Shams University Hospitals. Identify factors affecting QOL among these patients. Design/methodology/approach – A cross-sectional study measured QOL among early stage female breast cancer (BC) patients and determined the main factors affecting their QOL. Three interviewer administered questionnaires were used. Findings – The physical domain mostly affected in BC patients and the functional domain least. Socio-demographic factors that significantly affected BC patients QOL scores were patient age, education, having children and family income. Specific patient characteristics include caregiver presence – a factor that affected different QOL scores. Age at diagnosis, affection in the side of the predominant hand, post-operative chemotherapy and difficulty in obtaining the medication were the disease-related factors that affected QOL scores. Originality/value – The final model predicting QOL for early stage female BC patients included age, education and difficulty in obtaining the medication as determinants for total QOL score. Carer presence was the specific patient characteristic that affected different QOL scores.

Small bank, big ambitions

2014 ◽  
Vol 30 (10) ◽  
pp. 1-4
Keyword(s):  
Business Performance ◽  
Best Practice ◽  
Global Financial Crisis ◽  
Management Style ◽  
Collaborative Management ◽  
American Business ◽  
Executive Development ◽  
Content Type ◽  
Start Up ◽  
Privately Owned

Purpose – The purpose of this article is to explain how an extensive program of executive development was used to stimulate a far-reaching change in organizational culture and strengthen business performance. Design/methodology/approach – It presents a case study describing how a privately owned Russian bank worked in partnership with an American business school at their European campus to boost management and leadership skills and create a culture that values teamwork, initiative taking and the free exchange of ideas. Findings – The first branch only opened in 1996, but by 2011, it was the third largest privately owned bank in Russia. But at Promsvyazbank (PSB) they wanted more – to compete on the basis of international best practice. Not such an easy task, after the global financial crisis had brought lending to customers to a halt and – perhaps understandably – taken attention away from executive development. Many banks in many countries faced difficulties following that crisis, including the issues of liquidity and capital limits facing PSB. But there were some extra challenges in their drive for expansion: two banks between them dominated the Russian home market: state-owned Sberbank and multinational Raffeisen, with market shares of 60 per cent and 15 per cent, respectively. It was time to ask what the bank needed to do to move from successful start-up to competitive, maturing organization. Practical implications – It emphasizes the role of leaders in driving and managing change and highlights the importance of a clear strategic focus. Social implications – It shows how the creation of a common culture and the adoption of a collaborative management style can stimulate knowledge sharing and strengthen business performance. Originality/value – It provides an insight into the managerial and cultural challenges executives must address as their successful start-up matures into an organization with ambitions to become the top privately owned bank in Russia.

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