InnovationAfrica » Entrepreneurship

Entrepreneurs need to balance risk of persisting with payoff of succeeding

admin — Tue, 21 May 2013 09:53:46 +0000

In a new business, sometimes the better part of wisdom is knowing when to quit, a new study concludes.

Even though persistence is a key to business success, entrepreneurs might be more successful if they not only knew when to start a business and take risks, but also knew when to abandon it and find something that provides a greater opportunity, researchers said.

It may be human nature to want to make an idea work, but it can also be a poor business decision to stay wedded to an idea if the evidence suggests it’s not working as well as another potential opportunity.

“Entrepreneurs need to balance that desire to persist, which is in fact what often makes someone a successful entrepreneur, with the ability to sense when it is time to walk away,” said Bobby Garrett Jr., an assistant professor of entrepreneurship at Oregon State University and co-author of the study.

The results are published online in the International Small Business Journal. Garrett and lead author Daniel Holland of Utah State University analyzed the decision-making process of 135 entrepreneurs in high-tech industries. They found that even when confronted with another business opportunity that could yield successful results, many entrepreneurs resisted quitting their current venture.

“It’s escalation of commitment,” Garrett said. “When an entrepreneur has invested resources into a new business, they have difficulty letting go even when things go south or another opportunity arises.”

Garrett likens this psychology to a casino mentality.

“Someone who has spent one hour at the roulette table may think, ‘If I just stick with it, I can win,’” he said. “An entrepreneur’s thought process is not dissimilar to this.”

However, that same doggedness is also what makes entrepreneurs successful. In the field of entrepreneurship, Garrett said this is called “entrepreneurial resilience.”

“Everyone knows that entrepreneurs often fail,” he said. “That same persistence, and ability to keep trying against the odds, is also an admirable trait, especially when that persistence pays off.”

In their study, the researchers recommend that any potential entrepreneur keep the risk versus reward of any venture in mind, and evaluate the chances that their start-up may succeed.

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Avon in Uganda? How microfranchises create small, low-risk jobs

admin — Mon, 20 May 2013 16:45:32 +0000

A door-to-door sales company in Uganda is giving a shot at entrepreneurship to would-be entrepreneurs who don’t want to risk everything. In the developing world, your typical entrepreneur isn’t like Warren Buffet or Sir Richard Branson, says Cecilia Zevallos of SAB Miller. Zevallos’s experience in Latin America has shown her that most entrepreneurs either inherited their business or started it to get a little extra cash for their families. These people aren’t rushing to bet their livelihoods on an industry with a 25 percent success rate. That’s why Living Goods, based in San Francisco, is fighting malaria in Uganda with a solution that allows its entrepreneurs to squeeze in business around their daily activities. It’s a model that was made popular in 1886 when David McConnell founded Avon, turning rural housewives into door-to-door saleswomen. Living Goods trains women to sell health products door-to-door, advancing the fight against malaria through a micro-franchise model. To make the health products affordable, Living Goods franchisees also sell much-needed products like cookstoves and solar lamps at a profit, and the health products at a discount. For a few hours of work, agents can make $20 a month–enough to send the kids to school–and the model is profitable enough that after only five years, the company makes enough to cover its product sales. Revenue was $500,000 last year–not a lot but enough to suggest that the model can work at a larger scale. Living Goods is not alone in its success. Scores of social enterprises across the globe, from Accesso Chakipi in Peru to Grameenphone in Bangladesh and Solar Sister in Sub-Saharan Africa, are using micro-franchising and door-to-door sales agents to get their products to the hardest-to-reach areas of the globe. There are numerous advantages for the companies: access to remote areas, an existing trust-based relationship between the salesperson and customer, and the ability to sell products that achieve triple-bottom lines. In the case of Living goods, this can mean better health, raised income for women and reduced dependence on kerosene. But microfranchising does something else that other successful social enterprise models don’t: it recognizes that most entrepreneurs aren’t risk-takers and might work more effectively as managers. As quoted in the New York Times, microfranchising consultant Jason Fairbourne said:

It’s much more realistic and simple to train someone to be a manager than an entrepreneur. …Microfranchising is the provision of the full business package. The franchisee just has to follow the steps.

That’s exactly what Avon founder David McConnell recognized in 1886. Rural women lacked education but had the management abilities to become successful salespeople. Living Goods founder Chuck Slaughter saw the same potential when visiting a Healthstore Foundation clinic. He was impressed by how successful nurses were, especially when they left the clinics and went door-to-door offering health services. This inspired him to create a model that did away with the storefront completely. Because Living Goods trains and employs agents who start businesses primarily to boost their existing income, their model is low-risk and flexible. Agents can manage the family farm in addition to selling much-needed health products. Micro-franchisees get a business in a bag containing everything they need to market and sell the 70-odd products Living Goods offers, and after some basic training, they’re open for business whenever it is convenient for them. Living Goods claims that their training and monitoring is rigorous enough that even without established business hours, agents provide high-quality products and services to their clients. While the micro-franchise model may be a less flashy way to support entrepreneurship than investing $33 million to fund tech startups, it may achieve its development goals more effectively, and the entrepreneurs themselves might be more interested.

Living Goods’ agents can sell door-to-door for a few hours a week while still keeping up with household tasks, giving them a low-risk chance to boost their income. Photo: Living Goods (flickr)

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From Assiut to Zacatecas, do-gooders swarm startup competitions

admin — Sun, 12 May 2013 13:09:02 +0000

Social enterprise is popping up in startup competitions around the developed world, but tech-savvy social entrepreneurs from developing countries are scoring wins and turning heads as well.

Techies will be excited to learn about Google’s recently launched Global Impact Challenge, which is sending $3 million to nonprofit tech startups in the UK with the best ideas to change the world. Across the Atlantic, Harvard Business School’s newly-revamped “New Venture Challenge” doles out awards of up to $50,000 for its social enterprise track. Increasingly, however, social enterprises are raking in the winnings at competitions in the developing world, often knocking aside competition from profit-maximizing ventures.

In Latin America, Colombian Sustainable Agriculture Solutions made the 2012 winners list for Intel’s Desafío Intel, a startup competition linking Latino/a entrepreneurs with Silicon Valley expertise. SAS uses nanotechnology to produce a fertilizer that is 40 percent more efficient, cheaper and less damaging to the environment. Leading the way in Asia, The Chinese University of Hong Kong has been running a social enterprise challenge since 2007, connecting hundreds of would-be social entrepreneurs from all around Asia with incubators and potential investors. Globally, many star social enterprises have gotten their start through the Global Social Venture Competition, including d.light Design and Next Drop.

But social entrepreneurs in the Middle East and India may stand the most to gain from these competitions. In Palestine, information and technology are now the largest sector of the economy, and Startup Weekends have been hosted in Gaza, Nablus and Ramallah. In addition to regional tech companies, humanitarian groups like Mercy Corps and USAID have sponsored events in Palestine and in Egypt. In Delhi, a mobile-focused startup weekend saw anti-corruption app Awenest take second prize, and Intel-sponsored Next Big Idea gave its first prize to a biomass energy company last year.

Startup competitions, especially those focused on technology and innovation, directly address the social problems these countries face. Internet sales promise to boost the Palestinian economy where regional conflict has made physical exports difficult. Tech competitions in Assiut and Cairo have given women the opportunity to participate in business in places where rising university graduation rates have not translated into many new jobs for women. Most importantly, startup competitions and incubators can provide alternatives to political instability and unrest in countries like Pakistan, according to the authors of a recent report by the Economic Policy Group.

Because of the difficult nature of defining which enterprises are “social” and which aren’t, Startup Weekend hasn’t separated the two yet, preferring to focus on boosting enterprises no matter their goals. However, in its partnership with Mercy Corps, it is launching the first “Tech4Change Weekend” on June 7-9 in Portland, Oregon–a Startup Weekend where social impact will play a leading role. The international NGO will share insights about the needs of the “bottom billion” while the tech and business gurus will explore ideas to solve the challenges presented.

Increasingly, however, those “bottom billion” solutions will come from the global South. At Mercy Corps, an Egypt-based impact investing fund is in the works, and Andy Dwonch, senior director of social innovations, sees participation in Startup Weekends as a huge opportunity to address youth unemployment across the globe:

“Startup Weekends are extremely useful to get young people and other participants thinking about ‘doing something’ on their own and not simply waiting for an existing company to hire them… these events help to shake things up, get participants and communities excited.”

But start-up competitions are just a step in enriching entrepreneurial communities, Dwonch says. For Mercy Corps, they are accompanied by “mentoring and acceleration services, and a range of financial investors from very early stage seed investors to later stage expansion capital.”

Wherever you are in the world, it seems nonprofits and companies are increasingly recognizing social enterprise’s rightful place within venture capital and startup culture.

Social enterprises are increasingly winning start-up competitions around the globe, even in competitions against profit-maximizing ventures. Photo: Tiago A. Pereira (fickr)

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New ideas about social entrepreneurship: Yes, they still exist

admin — Fri, 10 May 2013 13:08:48 +0000

Social enterprise is so new that many aspiring entrepreneurs don’t know where to begin. They can now find their way thanks to a new guide stocked with advice from the field.

“Breaking the Binary: Policy Guide to Scaling Social Innovation,” recently published by the Schwab Foundation for Social Entrepreneurship, is a how-to on innovation geared toward social entrepreneurs and policymakers looking to improve their organizations. It profiles 12 government programs and 20 nonprofits working on the cutting edge of innovation, organizing them according to six broad categories of innovation. Because social enterprise is so new and untested, the guide highlights success stories and encourages readers to think about how to modify these solutions for their own context.

Here are three tips for running your social enterprise that go beyond the standard fare:

Prove that it works more than once. Measuring the impact of pilot projects is universally popular, but Waste Concern’s Iftekhar Enayetullah said it’s not enough to get good numbers from one place: “Unless you can prove a concept in different locations, it is very difficult to scale up. The biggest lesson we learned … is that you have to invest a lot of time on the proof of concept. During that stage, it’s very important for private companies to be more than investors – they need to be real partners and to interact frequently with you and with the regulators.”
Use your products to connect emotionally. “To educate people and help them improve their quality of life, you need to connect emotionally with them,” said Cinepop’s Ariel Zylbersztejn, whose organization uses free movie showings as a way to educate and organize hard-to-reach communities. “People love to participate in our platform because they have fun … and [we] know that 3 out of 10 people who participate in our events change their habits or behaviors.” In other words, your beneficiaries aren’t just clients; they’re humans too.
Play to the unique strengths of the social enterprise sector. “We as social enterprises are at our best when we identify existing gaps in society – gaps that neither government nor natural market forces are meeting yet,” said Included’s Jonathan Hursh. Proximity Design’s Jim Taylor sees huge potential in how social enterprise bridges the private and nonprofit sectors: “Because [NGOs] are not getting signals back from those customers, they can sometimes get away with sloppy services … Treat people as customers like any other business would. Make yourself easy to do business with, and ensure strong business experience is part of your organization’s DNA.”

It’s not all roses, however. Serious legal hurdles have stifled progress, because government regulation often fails to keep up with the pace of innovation. Most countries do not even have a legal classification for social enterprises, and without a larger infrastructure, including government support systems, social enterprises can have difficulty surviving.

Sometimes, social enterprise takes the lead in building partnerships: Brazilian think tank Imazon approached the local government promising to document illegal deforestation so that the government could use that evidence to enforce its laws. In other cases, governments must choose the social issue for social enterprises to work in and funnel money so that the initiatives get the backing they need. For example, the Ghanaian government created a trust fund in 2004 that has channeled more than $14 million in aid money to kickstart microfinance funds and grow local businesses.

This guide is a practical tool because it offers recommendations based on experiences in the field —a highly valuable resource for any social innovator.

Read the complete report here.

From Colombia to Bangladesh, social enterprises are using the market to eradicate poverty. A new report highlights 20 of them plus 12 government projects focused on social innovation. Photo: waterdotorg/Flickr

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Highly innovative and extremely entrepreneurial individuals: what are these rare birds made of?

admin — Wed, 01 May 2013 20:10:10 +0000

Abstract

Purpose – The purpose of this paper is to advance and clarify conceptualisations of innovative and entrepreneurial individuals through the analysis of their personality traits. Design/methodology/approach – This study has elements of both theory testing and theory creation, which led the authors to choose the case study as their research strategy. The “case” is an innovative and entrepreneurial individual, and the authors used extreme-type empirical cases to develop ideal-type concepts. The analysis is based on extensive longitudinal data.

Findings – The study makes a contribution to theories of both entrepreneurship and innovation. It adds conceptual clarity in terms of providing evidence that the individuals concerned should not be considered as one characteristic group of actors. The authors propose that highly innovative and entrepreneurial individuals can be further divided to entrepreneurial innovators and innovative entrepreneurs. Practical implications – This study may enable the colleagues, business partners and competitors of entrepreneurial innovators and innovative entrepreneurs to better understand – and to some extent also to forecast – their behaviour. It also gives some hints regarding cooperation opportunities with both types of individual, and getting the most out of them. The results should also help policy makers and support agencies to recognise these people, who play an important role in the economy.

Originality/value – To the authors’ knowledge this study is the first to analyse the traits of individuals who are both extremely innovative and highly entrepreneurial.
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Becoming entrepreneurial: gaining legitimacy in the nascent phase

admin — Wed, 01 May 2013 19:50:55 +0000

Abstract

Purpose – The purpose of the article is to examine how legitimacy as ‘an entrepreneur’ is gained in relation to others during the nascent phase. Design/methodology/approach – Two firm creating teams are studied over a 12 month incubation period. Data collected through participant observation, documentation and interviews is emploted as narratives in order to explore how nascent entrepreneurs gain legitimacy through social interaction. Positioning theory is used to explore how negotiated rights and duties are employed towards legitimacy gaining strategies.

Findings – Conforming, selecting and manipulating strategies are used to gain legitimacy during a process of firm creation through interactive dialogue with key stakeholders (role-set). Positioning facilitates a process of negotiated rights and duties that helps to define the role of ‘entrepreneur’ to which the nascent entrepreneurs aspire.

Research limitations/implications – The study is bounded to a specific contextual setting and thus initial findings would benefit from further investigation in comparable and control settings. Findings illustrate the ways in which nascent entrepreneurs employ legitimacy gaining strategies through interaction with key stakeholders, an area of research not well understood. This contributes to an understanding of how entrepreneurial identity is developed.

Practical implications – Designed firm creation environments can facilitate interaction with key stakeholders and support positioning of nascent entrepreneurs as they attempt to gain legitimacy in the role of ‘entrepreneur’ while creating a new firm. Legitimacy gaining strategies can strengthen entrepreneurial identity development, which can be applied to multiple entrepreneurial processes. Originality/value – The article accesses individuals in the process of becoming entrepreneurs, a phenomenon most often studied in hindsight. Emphasis on stakeholder interaction as contributing to entrepreneurial development is also understudied. Legitimacy gaining strategies are explored through narratives using positioning theory, an approach which has been discussed conceptually but not readily applied empirically.
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QUALITATIVE ENTREPRENEURSHIP AUTHORSHIP: ANTECEDENTS, PROCESSES AND CONSEQUENCES

admin — Wed, 01 May 2013 19:48:26 +0000

Abstract

Purpose – This paper reports on a systematic review of the writing practices and experiences of scholars who have published qualitative papers in the field of entrepreneurship. It evaluates existing knowledge about how ‘well-published’ entrepreneurship scholars go about writing up qualitative research. It identifies good practices in qualitative research authorship as self-described by authors. It identifies the antecedents, processes, and consequences of qualitative research authorship as self-described by authors.

Design/methodology/approach – Scholars who had published qualitative papers in five top ranked entrepreneurship journals over a twenty year period, were asked to complete a qualitative survey about their writing practices. A qualitative analysis of 37 usable replies was undertaken.

Findings – Entrepreneurship scholars perceive their qualitative research writing to be more enriching and philosophical than quantitative research. Although they feel strong connections with their research subjects, they find qualitative research difficult and time consuming to write up. It is hard to bridge the gap between working with large amounts of transcribed data and the editorial requirements of journals, without losing the vitality of data. Qualitative research and subsequent writing skills have often been learned by trial and error. Many are inspired by specific texts, which may include novels, poems or plays.

Research limitations/implications – This work shows how useful it is to discuss qualitative writing processes so that we may learn from the “blood, toil, tears and sweat” of those who have already successfully navigated both the writing and publishing of qualitative research.

Originality/value – Although there is a vigorous debate within the Entrepreneurship literature about the prevalence and suitability of different methods and methodological approaches, there is no explicit discussion of how researchers engage with writing up qualitative research for publication. The paper addresses this gap and shares insights and guidance from our community of practice.
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HOW COMMUNITY VENTURES MOBILISE RESOURCES: DEVELOPING RESOURCE DEPENDENCE AND EMBEDDEDNESS

admin — Tue, 23 Apr 2013 17:50:38 +0000

Publishers note (FSG): Valuable learning for African social entrepreneurs at the community level.

Abstract

Purpose – This paper aims to build theory on the resource mobilisation process of nascent community ventures (CVs). CVs are a type of social enterprises set up with the aim of creating social wealth within the communities in which they reside. Guided by resource dependence theory, we analyse how CVs introduce new ideas and activities into conservative communities. In particular, we explore how emerging CVs mobilise resources from local communities and how the resource mobilisation process shapes these new ventures.

Design/methodology/approach – We conducted longitudinal case studies on the emergence of two music festivals in rural communities in Norway. Findings – In the early stages of the venture formation process, the nascent CVs had an asymmetric dependence relationship with local resource providers because they lacked legitimacy and resources. The CVs were seeking to introduce new activities, and they simultaneously implemented two strategies to access resources: they adapted to and altered their environment. Throughout the resource mobilisation process, the CVs developed a joint dependence relationship with local resource providers. In later stages of the process, the CVs implemented strategies to increase their embeddedness and engage greater portions of the local communities in the ventures.

Originality/value – Our longitudinal approach to the resource mobilisation process made it possible to reveal how entrepreneurs and local resource providers interact over time to create new CVs. Building on resource dependence theory we provide an explanation for how CVs are able to become embedded in their local communities while introducing new ideas that departs from existing practices.
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Narratives of transition from social to enterprise: You can’t get there from here!

admin — Fri, 19 Apr 2013 16:38:07 +0000

Abstract

Purpose – In response to calls to critically analyse and conceptually advance social enterprise, we examine narratives and models representing a spectrum of social enterprise from the ‘social’ to the ‘economic’. We test these against the experience of practitioners who were either employees in social organisations or support workers tasked with promoting social enterprise. This is timely against a background of imperatives from central governments for social organisations to compete for the delivery of public services and become more ‘entrepreneurial’.

Design/methodology/approach – We report qualitative research in which participants were invited to draw lines and arrows onto spectrum models to illustrate the social and economic contexts they perceived themselves to be working within. The data comprise interviews and drawings, combined with verbal descriptions of the drawings and reflections on their significance.

Findings – We show how participants interpreted the ‘social’ and ‘economic’ of social enterprise in pictures and words. The research suggests that social enterprise can not be told as a single narrative but as a set of little stories showing oscillations, contradictions and paradox.

Research limitations/implications – Understanding of social enterprise can be much improved by giving greater recognition to ambiguities and compromises within the lived experience of contemporary practice.

Originality/value – The article offers new reflection on widely used images that represent social enterprise along a dichotomous, polar spectrum from social to economic.
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Postmaterialist values and entrepreneurship. A multilevel approach.

admin — Fri, 19 Apr 2013 16:36:11 +0000

Abstract

Purpose – Postmaterialist values (autonomy, self-expression, fulfilment of personal goals) have been shown to predict entrepreneurship at the country level. In this paper we aim to expand previous research by testing the relationship between postmaterialism and entrepreneurship at the individual level across 39 countries.

Design/methodology/approach – In a series of multilevel models, with individuals nested within countries, we tested whether individuals’ postmaterialist values predict the probability of becoming an entrepreneur after controlling for income level, age, gender and education level. To do this we used Inglehart’s 12-item Postmaterialism-index. Data was taken from the 1999-2004 database of the World Value Survey on approximately forty-five thousand subjects from 39 countries. Models with random intercepts and random slopes were calculated.
Findings – This paper presents evidence on three issues: postmaterialism decreases a person’s likelihood of becoming an entrepreneur; the effect of postmaterialism on entrepreneurship varies across countries; and this effect is more negative in countries with high levels of entrepreneurship.
Research limitations/implications – Theoretical implications: individuals with materialist values are more likely to be entrepreneurs than postmaterialist individuals. This finding provides support to the hypothesis that entrepreneurs are basically economically driven people.
Practical implications – Practical implications: the efficacy of public policies to promote entrepreneurial activity could be overshadowed by more deeply-rooted cultural orientations, postmaterialism in this case.
Originality/value – The relationship between postmaterialism and entrepreneurship has been studied previously using countries as the unit of analysis; this paper’s main contribution is that it expands this line of research to the individual level of analysis.
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Tweetable insights on entrepreneurship from Google’s Cairo confab

admin — Tue, 09 Apr 2013 09:05:48 +0000

The market now is emerging and growing to the point that not a single person can do it alone. If you have a dream, you better share it.

- Amr AbdelRahman, co-founder of MIMV

The Giza sun elicited hot topics last Saturday as emerging entrepreneurs and experienced experts shared challenges and strategies for new business in the Middle East and North Africa.

Wamda, an entrepreneurial support platform for the MENA region, launched its new partnership with Google through the expansion of an event series called Mix N’ Mentor beginning March 16. Mix N’ Mentor brings young entrepreneurs in contact with a variety of “mentors” ranging from industry experts to investors to serial entrepreneurs. (Con O’Donnell of Mercy Corps Egypt, an entrepreneurship advisor, was among the mentors.) Cairo’s was just the first in a series of Mix N’ Mentor events scheduled to take place in 11 different cities across the MENA region.

The series was built on successes last year in Amman, Beirut and Dubai, which inspired Wamda to expand and seek help from Google. This year, Google lends a hand with speakers and experts, as well as advanced technological assistance to widely share insights from these events via Hangouts on Air on Google+.

Google is proud to be a part of the program, says Maha Abouelenein, head of communications for Google in the MENA region.

“Google began as a startup in a garage and remains a startup at heart,” she said in an interview with Wamda last week. “We are committed to helping build a vibrant ecosystem for startups and enabling the next generation of entrepreneurs to be successful.”

Interact href="http://www.flickr.com/photos/76608681@N07/8564819496/">Interact Egypt - Play Innovation via Compfight href="http://compfight.com">Compfight cc href="http://creativecommons.org/licenses/by-nc-sa/2.0/">cc" src="http://www.innovationafrica.org/wp-content/plugins/wp-o-matic/cache/babb421611_mixnmentor.jpg" />

On Saturday, at the Cairo Swiss Club in Giza, entrepreneurs and mentors broke into small groups based on skills and challenges in their specific industries, rotating to maximize diversity and exposure. Throughout the day sessions were punctuated by inspiring speakers and a “Fireside Chat,” which allowed a panel of successful entrepreneurs to answer questions from the audience. The day ended with an open networking session among all participants. The new partnership with Google for entrepreneurs encouraged more hands-on technology coaching and exposure to the latest Web and mobile tools.

So what do you get when you combine ambition, experience, new technology and inquisitive minds?

Wamda reveals some of the key insights specific to emerging businesses in Cairo as well as broader “tweetable tips” to share with entrepreneurs across the region.

Many entrepreneurial ventures these days rely on e-commerce. According to Wamda, in Egypt, as in much of the Arab world, e-commerce startups face some major hurdles to growth, including a lack of banking options, a general mistrust of online purchasing, and outdated or nonexistent government regulation. Egypt is an especially tough market due to high computer illiteracy, a poor telecom infrastructure and weakened economic conditions. Political uncertainty since the revolution in 2011 does not help, either.

However, there is also lot of energy around starting up companies in Egypt and therefore plenty of opportunity to combine talents. Mentors encouraged their audience to look for partners with different skill sets.

The ideal startup would have three co-founders, two technical employees and a hustler.

- Mike Butcher, editor-at-large at TechCrunch, in his initial talk at Mix ‘N’ Mentor, ‘How to Pitch to Tech Bloggers’

Entrepreneurs in Egypt are also facing challenges finding investment after graduating from their initial accelerator programs. Panels at Mix N’ Match highlighted the importance of portraying the uniqueness of their product or company as well as concentrating on specific investors for fundraising.

Finding an investor is not only about money, it’s like finding a partner. If you’re just looking for money, go to a bank.”

-Karim Beshara, CEO of Orascom Telecom Media

Egyptian entrepreneurs have strong technical skills, a key advantage for the country. But technology cannot foster success on its own. New businesses also need marketing and communications.

When hiring, I look for personality before technicality.

-Mahmoud Ghoz, CEO of Rawy.me

Finally, Butcher pointed to the main challenge and inspiration of the day: being unique. “We in the tech press look for purple cows,” he told the crowd. In other words: startups that stand out and may not have existed before are the most interesting to follow.

Despite current challenges and obstacles, the region of the Middle East and North Africa is proving to be a purple cow in the world’s entrepreneurial ecosystem.

Some emerging entrepreneurs in Cairo get firsthand advice from experts at Mix N’ Mentor. Photo Credit: AltCity.

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The Skills Most Entrepreneurs Lack

admin — Tue, 02 Apr 2013 11:10:12 +0000

Entrepreneurs are a unique group of people, but they behave in patterns. In fact, as I recently wrote here on HBR, my firm’s research shows that most serial entrepreneurs display persuasion, leadership, personal accountability, goal orientation, and interpersonal skills. But in that same study, we also discovered a set of skills they do not possess.

To rehash our methods, we assessed subjects identified as serial entrepreneurs on what personal skills they possessed. Then they were compared to a control group of 17,000. As before, this group was assessed on their mastery of 23 practical, job-related skills. We measured whether skills were well developed, developed, moderately developed, or needed developing.

After analyzing the data, we found four distinct skills lacking in most serial entrepreneurs, three skills statistically significantly and one other also noticeably lacking. The statistical significance is derived by comparing the lowest ranking skills to the entrepreneurs’ top skills, as evaluated in the first study.

Empathy is one of the qualities serial entrepreneurs lack most. Entrepreneurs build things and solve problems for people, but according to this study they do this in hopes of a return on investment. Entrepreneurs may have high empathy on an intellectual level, in that they want to produce a product or service that will help someone. This is often, however, also tied to the entrepreneur receiving a return for their time and effort, which people with high empathy do not generally expect.

Entrepreneurial-minded people are not proficient in managing themselves and their time. In many jobs, managing personal day-to-day tasks might take away from accomplishing larger company goals, which are critical to entrepreneurs. Since entrepreneurs typically have many projects underway at one time, they simply do not have time to micromanage each. Often they need assistance managing everyday tasks and should hire or delegate them to someone who has mastered this skill.

This leads to another skill entrepreneurs lack: planning and organizing. Similar to self-management, if entrepreneurs spent time planning and organizing every task or meeting, they would never get anything else done. Once again, hiring someone to keep their calendar, organize meetings and events, keep the office de-cluttered, and help keep them on schedule can put them at an advantage.

Entrepreneurs also do not excel above the control group when it comes to analytical problem solving. They have high utilitarian motivators (potential future gains, monetary returns, new products or ideas), so their focus is often on making a quick decision. They have a sense of urgency in decision-making, and by nature they do not have time to collect and analyze the data. They see numbers as getting in their way, and they should – everyone who has told them an idea wouldn’t pan out has used data and logic to illustrate that point. For example, Martin Luther King Jr. stated, “I have a dream.” He did not say, “I have a plan and strategy.” Entrepreneurs have the vision, but need to employ people to create an executable strategy and carry it through.

Entrepreneurial-minded individuals possess a distinct set of skills that lead to great leadership and ideas. Perhaps the skills they have not mastered are equally important. With an understanding of those weaknesses, they can compensate for them by surrounding themselves with people who excel in these areas. As a leader, realizing other’s strengths and dovetailing them into your own weaknesses is key to developing a team that will carry out your grand vision and achieve goals.

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Highly innovative and extremely entrepreneurial individuals-What are these rare birds made of?

admin — Thu, 28 Mar 2013 11:57:24 +0000

Abstract

Purpose – The purpose of the study was to advance and clarify conceptualisations of innovative and entrepreneurial individuals through the analysis of their personality traits.Design/methodology/approach – This study has elements of both theory testing and theory creation, which led us to choose the case study as our research strategy. Our ‘case’ is an innovative and entrepreneurial individual, and we used extreme-type empirical cases to develop ideal-type concepts. The analysis is based on extensive longitudinal data.

Practical implications – This study may enable the colleagues, business partners and competitors of entrepreneurial innovators and innovative entrepreneurs to better understand – and to some extent also to forecast – their behaviour. It also gives some hints regarding cooperation opportunities with both types of individual, and getting the most out of them. The results should also help policy makers and support agencies to recognise these people, who play an important role in the economy.

Originality/value – To our knowledge this study is the first to analyse the traits of individuals who are both extremely innovative and highly entrepreneurial.
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When Big Companies Fall, Entrepreneurship Rises

admin — Tue, 19 Mar 2013 14:24:14 +0000

When a whale dies, the 30-100 ton body — or “whale fall” — slowly, silently sinks to the ocean bottom where it becomes the wellspring of a complex new microcosm of seabed flora and fauna that can thrive for well over half a century. These new ecosystems with their hundreds of species from flesh-eating sharks to sulphur-metabolizing worms also include “innovative start-ups” — previously undiscovered new sea animals that have naturally selected to flourish in the unique ecosystem.

There are many ways that live “corporate whales” can cultivate entrepreneurship ecosystems — as investors with capital for ventures to grow, as customers who buy innovative products, or as marketing partners to give the small dynamic firms global reach. I am a big believer of the symbiotic necessity of large companies and entrepreneurial ventures living side by side: You simply cannot have a flourishing entrepreneurship ecosystem without large companies to cultivate it, intentionally or otherwise.

But one of the deep, dark secrets of the flourishing of entrepreneurship in parts of the world as diverse as Israel, India, Colorado, and Denmark has been “corporate fall” — the death or shrinkage of large corporate incumbents whose detritus feeds the entrepreneurship culture. We don’t have far to look for current examples: Today Finland is witnessing an upsurge in entrepreneurship now in part because corporate giant Nokia is in the midst of shedding 10,000 high-quality jobs. As it happens, the “Nokia Bridge Program” is a socially minded strategy for both easing the pain of layoffs, and intentionally supporting the more talented.

A similar drama is taking place in aptly-named Waterloo Canada as RIM’s BlackBerry smartphones have become overripe. Initially fueled by RIM’s success, Kitchener-Waterloo’s “Quantum Hub” is now being fed by its turbulent ups and downs, with thousands of highly trained people flooding the small region.

Whereas superficial accounts of the rise of entrepreneurship in societies selectively glorify government interventions, few tell the story of death. In August 1987, for example, under severe United States pressure, the Israel government abruptly and controversially cancelled the Lavi fighter development project that was to be Israel’s answer to the F-16 and the societal equivalent of NASA’s moon program. Estimates of jobs eventually lost from the closure of the multi-billion dollar project range from 1,500 to over twice that many. But it is no coincidence that Israel’s entrepreneurship skyrocketed in the late 80s and early 90s just after the Lavi was grounded. Many of the thousands of highly qualified engineers either started companies or joined growing start-ups — it did not take too many talented people with experience in developing advanced technology products to turbocharge Israel’s entrepreneurial revolution. Less glitzy than start-up glam perhaps, but the reality in this case is that it took the death of a once-promising project to generate the life of many new ventures.

In India in the late 1970s, there was a similar story. Until 1977, IBM — in those days the first-choice mainframe supplier to governments, enterprises, and armies — operated freely in India. When the government passed a law requiring foreign companies to transfer 60% ownership to local shareholders, IBM’s management said, “Not on my watch,” and unceremoniously closed shop. The result? Thousands of IBM-trained Indian executives helped to feed the emergence of a number of young BPO services providers, and some started their own software companies. Whatever quips we might have heard about IBM’s corporate bureaucracy, it has always been considered a premier training ground for computer sales, service, and engineering. As one local computer services start-up advertised, “IBM May Not Stay but IBM Talent is Here to Stay.”

Another IBM story, different setting: Boulder, Colorado, that vibrant entrepreneurship ecosystem, continues to remain true to its rocky, turbulent past: Waves of downsizings of IBM in the past three decades (as recently as 2010) in the small Boulder community have been highly correlated with the burgeoning of this vaunted start-up community. As some have observed, “In the Boulder area, the early layoffs of talented IBM employees played a large role in supplying individuals to start ventures or to be hired by other start-ups.” Ditto for Boulder’s Storage Technology (which went bankrupt), as did Necton Bylinnium.

In 2008, financial services firms, primarily in and around New York City, dumped hundreds of thousands of people into the ranks of the unemployed (26,000 alone at Lehman Brothers). Lo and behold! New York City is undergoing an entrepreneurial revolution, now the second or third biggest deployment of venture capital in the world (depending on which mayor you believe, New York’s Bloomberg or Boston’s Menino).

“Corporate fall” is an important component of “entrepreneurship rise” (one component of many, it should be noted). What happens to entrepreneurship ecosystems when corporations fall? The reality is, they almost always adapt and grow in creative and novel ways. I make this observation fully cognizant of, and sympathetic with, the pain of being tossed out into the street, as so many people are when corporations fail, downsize, or restructure. The practical implication here is obviously not to encourage or applaud corporate death, just as recognizing the ecosystem renewal after a the loss of a whale is obviously not a call to go out and kill whales. But in an ever more complex and volatile world, business leaders and policy makers would be well served in allowing nature a little more rein in playing out its course.

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Startup operations and problems of honey bee entrepreneurs: experience from India

admin — Mon, 18 Mar 2013 10:26:09 +0000

Startup operations and problems of honey bee entrepreneurs: experience from India
Khushdeep Dharni; Deepak Goel
International Journal of Entrepreneurship and Small Business, Vol. 18, No. 3 (2013) pp. 332 – 348
Present study is an attempt to study the profile and start up operations of the honey bee entrepreneurs in Punjab. Findings of the study are based on a sample of 50 respondents. Results obtained from the analysis of the data collected from a pre-structured questionnaire administered in the local language, indicate that the entrepreneurial activity of beekeeping is occupied by semi-medium and medium male farmers. Most of the entrepreneurs undertaking beekeeping take it as subsidiary occupation, as it can be managed along with other farm activities and proves to be remunerative for the farmers. Results indicate that the public extension services rendered by organisations such as Punjab Agricultural University have played a crucial role in imparting the technical knowledge required for beekeeping activities. It was observed during the study that most of the entrepreneurs start with stationary beekeeping and subsequently shift to migratory beekeeping. Major problems faced by the respondents were related to labour, marketing and production. Efforts are required to ensure that rural youth are motivated to take up beekeeping business as most of the ventures were started by the middle aged farmers.

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