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To what extent is the relationship between effectuation and venture capital non-linear? : A study amongst Dutch expert entrepreneurs

Haren, Q.M.R.F van (2018) To what extent is the relationship between effectuation and venture capital non-linear? : A study amongst Dutch expert entrepreneurs.

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Abstract:Entrepreneurship is a subject which received a lot attention in the past and is still prominent present-day. Entrepreneurship creates jobs and solutions to existing problems, but it can also initiate demand for new products/services. An entrepreneur is faced with many decisions during the existence of their company, regardless whether they are short-term or long-term. In literature, two different dichotomous variants (causation and effectuation) have been introduced with regard to the decision-making process of entrepreneurs. Within these two concepts, there are 4 dimensions which can assess the difference in the decision-making processes. Several authors asserted that when sufficient means are available to the entrepreneur, to start up their business or either to accelerate growth, the theory of effectuation is no longer applicable. This study is aimed at exploring the relationship between venture capital and effectuation and thereby to investigate the statements made. Interviews were conducted with 10 expert entrepreneurs, whereby several questions were asked surrounding the 4 dimensions of effectuation and causation. Results in this study showed that the acquisition of venture capital does not necessarily lead to an adoption of causal logic within the decision-making process of entrepreneurs. A combination of both effectual and causal logic prevails with regard to the 4 dimensions of effectuation. This leads to the conclusion in which it can be stated that the relationship between effectuation and venture capital is not non-linear. For future research, it will be contributive to investigate whether the stage of a company’s life cycle in which venture capital has been attracted, can influence the decision-making process of entrepreneurs. Additionally, it would be of interest to find out whether the market type in which an entrepreneur is active in would be a factor to take into account to analyze the decision-making process of entrepreneurs.
Item Type:Essay (Bachelor)
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:85 business administration, organizational science
Programme:International Business Administration BSc (50952)
Link to this item:http://purl.utwente.nl/essays/75299
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