Three Essays in Entrepreneurship
Lee, Joo-Heon, Darden Graduate School of Business, University of Virginia
Venkataraman, Sankaran, Darden Graduate School of Business, University of Virginia
Freeman, Robert, Darden Graduate School of Business, University of Virginia
Entrepreneurship is complex socio-economic phenomena involving interaction between diverse people and their idiosyncratic environments. Thus, since the existing discipline appears to have developed its theories for explaining its unique problem from its unique perspective, existing theories from traditional disciplines might not be appropriate for giving accurate explanation of entrepreneurship. This thesis is a collection of my three interdisciplinary inquiries. In the first essay, I try to explain why two different forms of risk capital, informal venture investors and venture capitalists, exist simultaneously in the entrepreneurial equity market. I posit that just as there is diversity in the capital supply industry, there is also diversity in the ventures and entrepreneurs looking for such capital. Certain type of entrepreneurs and projects will be attracted mainly to professional venture capital sources (or vice versa) while other types of entrepreneurs and projects will be attracted to informal venture capital (or vice versa) sources. I argue both local (or previously acquired) knowledge and search efforts might not be fully reflected in the prices of informal venture investors. In the second essay, I attempt to offer a promising new direction to the question of why and when some people become entrepreneurs. I argue that the interaction between two multi-dimensional constructs, namely, "aspiration vectors (AV)" of individuals and the "market offering vectors (MOV)" of these individuals, determines both, the set of opportunities open to them and their locus of search among these opportunities. A set of propositions about the decision to become entrepreneurs based on conditions of dis-equilibrium between an individual's aspiration vector (AV) and his market offering vector (MOV) are offered. In the third essay, using the stakeholder theory, I try to offer realistic answers to the question of sources of entrepreneurial opportunities. The new entrepreneurial opportunities can be successful only when new entrepreneurs' creative solutions can reconcile conflicting values of diverse stakeholders and more adequately satisfy their stakeholders' values and interests. In other words, I argue that sources of entrepreneurship ultimately come from the improvements of diverse stakeholder relationships.
PHD (Doctor of Philosophy)
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