Beyond V2C: Entrepreneur�s Risks and Returns in the Era of Networked and Global Business (Track 3, Session 3)
Author(s) :
Jukka Ala-Mutka (Helsinki School of Economics, Finland)
Hamid Etemad (McGill University, Canada)
Abstract : The rapid rate of globalization and quickening pace of technological innovation expose new venture activity to fresh challenges. It is no longer logical to maintain that firms aspiring to grow focus on domestic growth first and on incremental internationalization later on. The increasing velocity of change in knowledge-intensive societies and firms may have also intensified the need for, and the speed of, growth at home and international markets at the same time. Despite these changes in business and society, the discussion around entrepreneurship has remained associated with niche marketing, limited business outlook, ad-hoc and intuitive strategies, lack of resources and capabilities as well as over-reliance on the owner-manager�s own initial competencies. The exceptions to these are the recent theoretical discussions and empirical findings regarding Born Globals and International New Ventures as well as V2C models (Venture-To-Capital). This paper will build on the latter research and model-building tradition by proposing a framework for growth venturing (or Venture-To-Growth � simply V2G) that starts with V2C and focuses on influential issues that impact the rate and pattern of rapid growth. V2G model goes beyond V2C model and proposes an entrepreneur�s personal view of the risks and returns as compared to that of the firm�s risks-return trade-offs. At the growth stages, the partnership of co-entrepreneurs and VC or IPO also means risk sharing for the original entrepreneur or founder. Larger group of founders and early stage actors allow the entrepreneur to consider him or herself differently, even lower the �risk� of his or her job than the traditional entrepreneurs. V2G model combine the best parts of the roles as an entrepreneur (owner) and hired manager. Thus, in this case, it is not any more only �your� firm, but a rapidly-growing enterprise with the corresponding V2G mindset. This V2G mindset avoids negative effect of a single owner. The separation of the roles of the owner and manager will allow the entrepreneur-founder to adequately cope with them. In sum, V2G model points out three proposals: first, it examines risks and returns from entrepreneur�s individual viewpoint; secondly it explores risks and ambitions between individual and enterprise; and finally it describes the importance of the ownership development of the enterprise and development of the value of the enterprise.

Menu