New Venture Creation Adv.
Week 1........................................................................................................................................ 2
Video: Unicorns, gazelles, and other distractions....................................................................2
Reading 1: Unicorns, gazelles, and other distractions on the way to understanding real
entrepreneurship in the united states (Howard E. Aldrich).......................................................3
Lecture 1: Introduction............................................................................................................. 5
Week 2........................................................................................................................................ 6
Reading 2: Gibrat’s Law: Are the Services Different?.............................................................6
Reading 3: Even Dwarfs Started Small: Liabilities of Age and Size and Their Strategic
Implications............................................................................................................................. 8
Lecture 2: Overcoming Liabilities..........................................................................................10
Week 3...................................................................................................................................... 16
Reading 4:: Continued Entrepreneurship: Ability, Need, and Opportunity as Determinants of
Small Firm Growth by Per Davidsson....................................................................................16
Reading 5: Does One Size Fit All? Exploring the Relationship Between Attitudes Towards
Growth, Gender, and Business Size by Jennifer E. Cliff........................................................17
Reading 6: Less Likely to Fail: Low Performance, Firm Size, and Factory Expansion in the
Shipbuilding Industry by Pino G. Audia and Henrich R. Greve..............................................19
Lecture 3: Conditions and Ambitions.....................................................................................21
Reading 7: Ansoff Growth matrix...........................................................................................24
Tutorial 1: Damen.................................................................................................................. 27
Week 4...................................................................................................................................... 27
Reading 8: Organisational Bueprints for Success in High-Tech Start-Ups (Baron & Hannan,
2002)..................................................................................................................................... 27
Reading 9: Contingent Labor as an enabler of entrepreneurial growth (Cardon, 2004).........29
Reading 10: Evolution and Revolution as Organizations Grow (Greiner, 2004)....................29
Lecture 4............................................................................................................................... 32
Reading 11: CONTINGENT LABOR AS AN ENABLER OF ENTREPRENEURIAL GROWTH
.............................................................................................................................................. 32
Week 5...................................................................................................................................... 34
Lecture 5: Financial Growth...................................................................................................34
Tutorial 2: Damen Q&A......................................................................................................... 35
Week 6...................................................................................................................................... 38
Lecture 6:.............................................................................................................................. 38
Lecture 6:.............................................................................................................................. 38
Reading 12: The franchising business model: an entrepreneurial growth alternative............42
Week 7...................................................................................................................................... 43
Lecture 7: Growing Industries....................................................................................................43
1
,Week 1
Video: Unicorns, gazelles, and other distractions
- People focus on VP, BCO, and IPOs → bias in the articles
- 58% of mentioned VP or IPOs, but in America there are only 100 IPOs a year
- There is an enormous gulf between the attention paid to IPOs, venture
funding, and the reality of entrepreneurial startups in America
2
,Reading 1: Unicorns, gazelles, and other distractions on the way to
understanding real entrepreneurship in the united states (Howard E. Aldrich)
Introduction
This article, by Howard E. Aldrich and Martin Ruef, critiques the overemphasis on
rare, high-growth start-ups like unicorns and gazelles in entrepreneurship
research. The authors argue that this focus skews our understanding of real
entrepreneurship in the U.S., overshadowing the experiences of ordinary start-ups
that form the backbone of the economy.
Key Terms and Concepts
1.Unicorns: Start-up companies with a valuation of $1 billion or more. While
they grab headlines, they are scarce and unrepresentative of the typical
entrepreneurial experience.
2. Gazelles: High-growth firms that increase their revenues by at least 20%
annually over four years. Like unicorns, they represent only a tiny fraction of all
businesses.
3. Black Swans: Unexpected, rare events with major impacts. In
entrepreneurship, this refers to highly successful, unpredictable start-ups.
4. Selection Bias: The tendency to focus research on successful, high-growth
firms, ignoring the vast majority of smaller, slower-growing, or struggling
businesses.
5. Entrepreneurial Ecosystem: The broader environment in which start-ups
operate, including cultural, institutional, and economic factors influencing
entrepreneurial activity.
Key Outcomes and Findings
1. Misplaced Focus in Research:
• IPO (Initial Public Offerings) and Venture Capital (VC) financing
dominate entrepreneurship studies despite their rarity.
• On average, only 100 U.S. firms went public annually between 2001
and 2016.
• VC deals peaked in 2000 but have since declined, yet academic focus
remains fixed on these exceptional cases.
2. The Reality of Entrepreneurship:
• Ordinary start-ups, not unicorns or gazelles, make up the majority of
new businesses.
• Most start-ups are small, locally-focused, and operate with minimal
external funding.
• 97-98% of new businesses are started by individuals, not VC-backed
entities.
3
, 3. Historical Roots of the Problem:
• The 1990s Silicon Valley boom shaped the field of entrepreneurship,
leading scholars to prioritize high-growth, tech-driven models.
• The rise of IPOs and VC culture during this period set a precedent,
influencing how entrepreneurship was defined and studied.
4. Consequences of the Bias:
• Public policy and academic resources are disproportionately allocated
to support high-growth ventures, neglecting the needs of small,
everyday entrepreneurs.
• This creates myths around entrepreneurship, such as the idea that
success requires large amounts of external funding or that innovation is
the primary marker of an entrepreneur.
Recommendations for Entrepreneurship Scholars
1. Broaden Research Scope:
• Shift focus from rare, high-capitalization events to typical start-up
experiences.
• Study ordinary businesses that reflect the diverse realities of
entrepreneurship.
2. Focus on Entrepreneurial Processes:
• Instead of just outcomes like IPOs, examine how businesses are
created, the challenges they face, and factors influencing survival.
• Emphasize entrepreneurial learning and organizational development
over time.
3. Use Representative Data:
• Leverage datasets like the Panel Study of Entrepreneurial Dynamics
(PSED), which captures a broad spectrum of entrepreneurial efforts, not
just the success stories.
Conclusion
The article calls for a recalibration of entrepreneurship research, emphasizing the
importance of studying the mundane and ordinary aspects of business creation. By
doing so, scholars can provide a more accurate, inclusive understanding of
entrepreneurship, one that reflects the experiences of the millions of small
business owners who form the backbone of the economy, rather than focusing
solely on the rare unicorns and gazelles that dominate headlines.
Let me know if you’d like to adjust or add anything to fit your lecture!
4
Week 1........................................................................................................................................ 2
Video: Unicorns, gazelles, and other distractions....................................................................2
Reading 1: Unicorns, gazelles, and other distractions on the way to understanding real
entrepreneurship in the united states (Howard E. Aldrich).......................................................3
Lecture 1: Introduction............................................................................................................. 5
Week 2........................................................................................................................................ 6
Reading 2: Gibrat’s Law: Are the Services Different?.............................................................6
Reading 3: Even Dwarfs Started Small: Liabilities of Age and Size and Their Strategic
Implications............................................................................................................................. 8
Lecture 2: Overcoming Liabilities..........................................................................................10
Week 3...................................................................................................................................... 16
Reading 4:: Continued Entrepreneurship: Ability, Need, and Opportunity as Determinants of
Small Firm Growth by Per Davidsson....................................................................................16
Reading 5: Does One Size Fit All? Exploring the Relationship Between Attitudes Towards
Growth, Gender, and Business Size by Jennifer E. Cliff........................................................17
Reading 6: Less Likely to Fail: Low Performance, Firm Size, and Factory Expansion in the
Shipbuilding Industry by Pino G. Audia and Henrich R. Greve..............................................19
Lecture 3: Conditions and Ambitions.....................................................................................21
Reading 7: Ansoff Growth matrix...........................................................................................24
Tutorial 1: Damen.................................................................................................................. 27
Week 4...................................................................................................................................... 27
Reading 8: Organisational Bueprints for Success in High-Tech Start-Ups (Baron & Hannan,
2002)..................................................................................................................................... 27
Reading 9: Contingent Labor as an enabler of entrepreneurial growth (Cardon, 2004).........29
Reading 10: Evolution and Revolution as Organizations Grow (Greiner, 2004)....................29
Lecture 4............................................................................................................................... 32
Reading 11: CONTINGENT LABOR AS AN ENABLER OF ENTREPRENEURIAL GROWTH
.............................................................................................................................................. 32
Week 5...................................................................................................................................... 34
Lecture 5: Financial Growth...................................................................................................34
Tutorial 2: Damen Q&A......................................................................................................... 35
Week 6...................................................................................................................................... 38
Lecture 6:.............................................................................................................................. 38
Lecture 6:.............................................................................................................................. 38
Reading 12: The franchising business model: an entrepreneurial growth alternative............42
Week 7...................................................................................................................................... 43
Lecture 7: Growing Industries....................................................................................................43
1
,Week 1
Video: Unicorns, gazelles, and other distractions
- People focus on VP, BCO, and IPOs → bias in the articles
- 58% of mentioned VP or IPOs, but in America there are only 100 IPOs a year
- There is an enormous gulf between the attention paid to IPOs, venture
funding, and the reality of entrepreneurial startups in America
2
,Reading 1: Unicorns, gazelles, and other distractions on the way to
understanding real entrepreneurship in the united states (Howard E. Aldrich)
Introduction
This article, by Howard E. Aldrich and Martin Ruef, critiques the overemphasis on
rare, high-growth start-ups like unicorns and gazelles in entrepreneurship
research. The authors argue that this focus skews our understanding of real
entrepreneurship in the U.S., overshadowing the experiences of ordinary start-ups
that form the backbone of the economy.
Key Terms and Concepts
1.Unicorns: Start-up companies with a valuation of $1 billion or more. While
they grab headlines, they are scarce and unrepresentative of the typical
entrepreneurial experience.
2. Gazelles: High-growth firms that increase their revenues by at least 20%
annually over four years. Like unicorns, they represent only a tiny fraction of all
businesses.
3. Black Swans: Unexpected, rare events with major impacts. In
entrepreneurship, this refers to highly successful, unpredictable start-ups.
4. Selection Bias: The tendency to focus research on successful, high-growth
firms, ignoring the vast majority of smaller, slower-growing, or struggling
businesses.
5. Entrepreneurial Ecosystem: The broader environment in which start-ups
operate, including cultural, institutional, and economic factors influencing
entrepreneurial activity.
Key Outcomes and Findings
1. Misplaced Focus in Research:
• IPO (Initial Public Offerings) and Venture Capital (VC) financing
dominate entrepreneurship studies despite their rarity.
• On average, only 100 U.S. firms went public annually between 2001
and 2016.
• VC deals peaked in 2000 but have since declined, yet academic focus
remains fixed on these exceptional cases.
2. The Reality of Entrepreneurship:
• Ordinary start-ups, not unicorns or gazelles, make up the majority of
new businesses.
• Most start-ups are small, locally-focused, and operate with minimal
external funding.
• 97-98% of new businesses are started by individuals, not VC-backed
entities.
3
, 3. Historical Roots of the Problem:
• The 1990s Silicon Valley boom shaped the field of entrepreneurship,
leading scholars to prioritize high-growth, tech-driven models.
• The rise of IPOs and VC culture during this period set a precedent,
influencing how entrepreneurship was defined and studied.
4. Consequences of the Bias:
• Public policy and academic resources are disproportionately allocated
to support high-growth ventures, neglecting the needs of small,
everyday entrepreneurs.
• This creates myths around entrepreneurship, such as the idea that
success requires large amounts of external funding or that innovation is
the primary marker of an entrepreneur.
Recommendations for Entrepreneurship Scholars
1. Broaden Research Scope:
• Shift focus from rare, high-capitalization events to typical start-up
experiences.
• Study ordinary businesses that reflect the diverse realities of
entrepreneurship.
2. Focus on Entrepreneurial Processes:
• Instead of just outcomes like IPOs, examine how businesses are
created, the challenges they face, and factors influencing survival.
• Emphasize entrepreneurial learning and organizational development
over time.
3. Use Representative Data:
• Leverage datasets like the Panel Study of Entrepreneurial Dynamics
(PSED), which captures a broad spectrum of entrepreneurial efforts, not
just the success stories.
Conclusion
The article calls for a recalibration of entrepreneurship research, emphasizing the
importance of studying the mundane and ordinary aspects of business creation. By
doing so, scholars can provide a more accurate, inclusive understanding of
entrepreneurship, one that reflects the experiences of the millions of small
business owners who form the backbone of the economy, rather than focusing
solely on the rare unicorns and gazelles that dominate headlines.
Let me know if you’d like to adjust or add anything to fit your lecture!
4
