Research summary: We investigate entrepreneurial network activation – the processes by which entrepreneurs select specific contacts from their existing personal network and persuade the selected contacts to provide referrals to access targeted early-stage investors (venture capitalists or angel-investors). We differentiate between selection of entrepreneur-centric contacts versus investor-centric contacts. We also distinguish between persuasion tactics that induce contacts' cooperation through promises of reciprocity versus offers of monetary incentives. We conducted two field-experiments in India and one in Singapore. Our primary field-experiment involved 42 Singapore-based entrepreneurs seeking referrals from 684 network contacts to reach a panel of 4 investors. Our evidence suggests that selecting investor-centric contacts leads to greater referral success; in addition, persuasion by promising reciprocity also leads to greater referral success. Managerial summary: A vital first-step for resource-starved entrepreneurs seeking funding for their scalable business-idea is to obtain referrals to early-stage investors, since such investors pay more attention to referrals from trusted contacts. Using field-experiments, we examine how entrepreneurs’ choices in selecting network contacts and persuading them to provide referrals drive their access to investors. Results suggest that compared to the habitual pattern of requesting referrals from contacts proximate to themselves, entrepreneurs are about 6 times more likely to secure successful referrals when they select investor-centric contacts for referral requests. Further, actively persuading contacts by promising future reciprocity results in about 3 times higher likelihood of securing successful referrals. Our findings show how thoughtful activation of existing contacts can enable even modestly-connected entrepreneurs to gain investor access.
{"title":"A Foot in the Door: Field-experiments on Entrepreneurs’ Network Activation Strategies for Investor Referrals","authors":"Jared Nai, Yimin Lin, Reddi Kotha, B. Vissa","doi":"10.1002/smj.3341","DOIUrl":"https://doi.org/10.1002/smj.3341","url":null,"abstract":"Research summary: We investigate entrepreneurial network activation – the processes by which entrepreneurs select specific contacts from their existing personal network and persuade the selected contacts to provide referrals to access targeted early-stage investors (venture capitalists or angel-investors). We differentiate between selection of entrepreneur-centric contacts versus investor-centric contacts. We also distinguish between persuasion tactics that induce contacts' cooperation through promises of reciprocity versus offers of monetary incentives. We conducted two field-experiments in India and one in Singapore. Our primary field-experiment involved 42 Singapore-based entrepreneurs seeking referrals from 684 network contacts to reach a panel of 4 investors. Our evidence suggests that selecting investor-centric contacts leads to greater referral success; in addition, persuasion by promising reciprocity also leads to greater referral success. Managerial summary: A vital first-step for resource-starved entrepreneurs seeking funding for their scalable business-idea is to obtain referrals to early-stage investors, since such investors pay more attention to referrals from trusted contacts. Using field-experiments, we examine how entrepreneurs’ choices in selecting network contacts and persuading them to provide referrals drive their access to investors. Results suggest that compared to the habitual pattern of requesting referrals from contacts proximate to themselves, entrepreneurs are about 6 times more likely to secure successful referrals when they select investor-centric contacts for referral requests. Further, actively persuading contacts by promising future reciprocity results in about 3 times higher likelihood of securing successful referrals. Our findings show how thoughtful activation of existing contacts can enable even modestly-connected entrepreneurs to gain investor access.","PeriodicalId":280939,"journal":{"name":"INSEAD: Entrepreneurship & Family Enterprise (Topic)","volume":"60 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2021-09-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"116696721","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Research summary. Firms in technology-based settings must mobilize individual knowledge to continuously execute innovative new opportunities. Because knowledge is generally conceptualized at the firm-level, however, we have only a limited understanding of how individual-level knowledge aggregates to firm-level outcomes. We develop a microfoundational theory to examine the individual-level foundations of firm-level innovation in the context of imitative competition. A key insight is that despite intuitions that knowledge mobilization should protect firms from rival imitation attempts, knowledge mobilization can often benefit rivals more than the focal firm itself, due to a process of continuous knowledge spillover-sharing amongst rivals. In addition, while knowledge-based advantages are often thought to be temporary without some isolating mechanism, sustainable advantage may emerge under limited conditions under which knowledge-mobilizing firms outrace rivals’ imitation efforts.
Managerial summary. Managers in fast-moving technology-based industries must mobilize the knowledge of individuals in their firm to execute new market opportunities arising over time. To do so, managers can employ processes such as transfer, collaboration, and recombination, which allow firms to draw on and use individual-level knowledge in different ways. We develop a computational model to generate insight into the implications of these different knowledge mobilization mechanisms in settings where individuals interact not just with others in the focal firm, but also with imitating rivals. We find that knowledge mobilization can often benefit rivals more than the focal firm itself due to a process of knowledge spillover-sharing amongst rivals. In addition, we develop insight into the limited conditions under which knowledge-mobilizing firms can achieve a sustainable advantage.
{"title":"Knowledge Mobilization in the Face of Imitation: Microfoundations of Knowledge Aggregation and Firm-Level Innovation","authors":"Jason P. Davis, Vikas A. Aggarwal","doi":"10.2139/ssrn.3502126","DOIUrl":"https://doi.org/10.2139/ssrn.3502126","url":null,"abstract":"Research summary. Firms in technology-based settings must mobilize individual knowledge to continuously execute innovative new opportunities. Because knowledge is generally conceptualized at the firm-level, however, we have only a limited understanding of how individual-level knowledge aggregates to firm-level outcomes. We develop a microfoundational theory to examine the individual-level foundations of firm-level innovation in the context of imitative competition. A key insight is that despite intuitions that knowledge mobilization should protect firms from rival imitation attempts, knowledge mobilization can often benefit rivals more than the focal firm itself, due to a process of continuous knowledge spillover-sharing amongst rivals. In addition, while knowledge-based advantages are often thought to be temporary without some isolating mechanism, sustainable advantage may emerge under limited conditions under which knowledge-mobilizing firms outrace rivals’ imitation efforts.<br><br>Managerial summary. Managers in fast-moving technology-based industries must mobilize the knowledge of individuals in their firm to execute new market opportunities arising over time. To do so, managers can employ processes such as transfer, collaboration, and recombination, which allow firms to draw on and use individual-level knowledge in different ways. We develop a computational model to generate insight into the implications of these different knowledge mobilization mechanisms in settings where individuals interact not just with others in the focal firm, but also with imitating rivals. We find that knowledge mobilization can often benefit rivals more than the focal firm itself due to a process of knowledge spillover-sharing amongst rivals. In addition, we develop insight into the limited conditions under which knowledge-mobilizing firms can achieve a sustainable advantage.<br>","PeriodicalId":280939,"journal":{"name":"INSEAD: Entrepreneurship & Family Enterprise (Topic)","volume":"234 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2019-12-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"114541657","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Starting with a fairy tale (sparked by the Brexit experience), this article explores the phenomenon of stubbornness. Although it describes how a leader’s stubbornness can be a force for the good—Charles de Gaulle being a prime example—it’s main focus is on how this behavior pattern can turn into a force for the bad. The fine line between stubbornness and persistence is explored, as well as the very narrow division between stubbornness and stupidity. It is demonstrated how, in many instances of stubbornness, the defense mechanism of denial reigns prominently. In addition, the role of the confirmation bias is highlighted. Also, stubbornness is explored from a phenomenological point of view, describing its behavioral manifestations. Reference is made to the relationship of stubbornness and power games, and ideological belief systems. Stubbornness is also looked at from a developmental point of view, taking an in-depth look at the kinds of strategies children use to deal with intrusive parenting. It is noted that stubbornness is often a strength of the weak—a compensatory reaction of dealing with a deep sense of inner vulnerability. Reference is made to the Diagnostic and Statistical Manual of the Mental Disorders (DSM V) description of the “Oppositional Defiant Disorder” (ODD), one of the more troublesome behavior patterns of childhood and adolescence. Finally, ways of dealing with stubborn people are explored.
{"title":"I Won’t, Therefore I Am: Being Stubborn","authors":"M. Kets de Vries","doi":"10.2139/ssrn.3253106","DOIUrl":"https://doi.org/10.2139/ssrn.3253106","url":null,"abstract":"Starting with a fairy tale (sparked by the Brexit experience), this article explores the phenomenon of stubbornness. Although it describes how a leader’s stubbornness can be a force for the good—Charles de Gaulle being a prime example—it’s main focus is on how this behavior pattern can turn into a force for the bad. The fine line between stubbornness and persistence is explored, as well as the very narrow division between stubbornness and stupidity. It is demonstrated how, in many instances of stubbornness, the defense mechanism of denial reigns prominently. In addition, the role of the confirmation bias is highlighted. Also, stubbornness is explored from a phenomenological point of view, describing its behavioral manifestations. Reference is made to the relationship of stubbornness and power games, and ideological belief systems. Stubbornness is also looked at from a developmental point of view, taking an in-depth look at the kinds of strategies children use to deal with intrusive parenting. It is noted that stubbornness is often a strength of the weak—a compensatory reaction of dealing with a deep sense of inner vulnerability. Reference is made to the Diagnostic and Statistical Manual of the Mental Disorders (DSM V) description of the “Oppositional Defiant Disorder” (ODD), one of the more troublesome behavior patterns of childhood and adolescence. Finally, ways of dealing with stubborn people are explored.","PeriodicalId":280939,"journal":{"name":"INSEAD: Entrepreneurship & Family Enterprise (Topic)","volume":"1 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-09-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"133403573","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
In Pakistan, the ownership of majority of the firms is characterized by the concentration of different groups such as family members, associated firms, institutional investors and insiders. The present study aims to investigate whether different ownership structure including family ownership, associated ownership, institutional ownership, concentrated ownership, managerial ownership, block holding, and foreign ownership contribute to the financial performance of nonfinancial firms listed at the Pakistan Stock Exchange (PSX). Findings suggest that a firm’s performance increases significantly in the presence of associated ownership, concentrated ownership, institutional ownership and block holding. This indicates that these ownership structures add value and help in reducing agency problems. On the other hand, family and managerial ownership have a negative relationship with firm performance. These findings are consistent with the hypothesis of minority shareholder expropriation which states that when family ownership and managers’ involvement is higher in a firm, they exploit the funds of minor shareholders. Similarly, foreign ownership also does not add value.
{"title":"Does Ownership Structure Affect Firm's Performance? Empirical Evidence from Pakistan","authors":"F. Khan, M. Nouman","doi":"10.22555/PBR.V19I1.1243","DOIUrl":"https://doi.org/10.22555/PBR.V19I1.1243","url":null,"abstract":"In Pakistan, the ownership of majority of the firms is characterized by the concentration of different groups such as family members, associated firms, institutional investors and insiders. The present study aims to investigate whether different ownership structure including family ownership, associated ownership, institutional ownership, concentrated ownership, managerial ownership, block holding, and foreign ownership contribute to the financial performance of nonfinancial firms listed at the Pakistan Stock Exchange (PSX). Findings suggest that a firm’s performance increases significantly in the presence of associated ownership, concentrated ownership, institutional ownership and block holding. This indicates that these ownership structures add value and help in reducing agency problems. On the other hand, family and managerial ownership have a negative relationship with firm performance. These findings are consistent with the hypothesis of minority shareholder expropriation which states that when family ownership and managers’ involvement is higher in a firm, they exploit the funds of minor shareholders. Similarly, foreign ownership also does not add value.","PeriodicalId":280939,"journal":{"name":"INSEAD: Entrepreneurship & Family Enterprise (Topic)","volume":"25 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2017-04-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"128627309","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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