New Venture Performance

9 Pages Posted: 21 Oct 2008

See all articles by Saras D. Sarasvathy

Saras D. Sarasvathy

University of Virginia - Darden School of Business

Abstract

This note examines the pros and cons of two ways to build new ventures. The former is called causal or predictive, because it depends on accurate predictions and clear goals. The latter is effectual or nonpredictive, and it is extremely stakeholder-dependent and means-driven. It is very tempting to jump to the conclusion that the latter is the better way since it is overwhelmingly preferred by expert entrepreneurs. But is that really so?

Excerpt

UVA-ENT-0074

NEW VENTURE PERFORMANCE

Two Toolboxes for Starting New Ventures

There are at least two ways of building new ventures. Most textbooks and newspapers suggest the following method:

· Do market research and competitive analyses to figure out target market segments.

· Develop marketing strategies, calculate cost/price margins, and make financial projections.

. . .

Keywords: new venture success, new venture failure, failure management, serial entrepreneurship, entrepreneurial decision making

Suggested Citation

Sarasvathy, Saras D., New Venture Performance. Darden Case No. UVA-ENT-0074, Available at SSRN: https://ssrn.com/abstract=1278395

Saras D. Sarasvathy (Contact Author)

University of Virginia - Darden School of Business ( email )

P.O. Box 6550
Charlottesville, VA 22906-6550
United States

HOME PAGE: http://www.effectuation.org

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