The Origin and Evolution of New Businesses - Hardcover

Bhide, Amar V.

Hardcover

ISBN 10: 0195131444 ISBN 13: 9780195131444

Publisher: Oxford University Press, 2000

Synopsis

What is this mysterious activity we call entrepreneurship? Does success require special traits and skills or just luck? Can large companies follow their example? What role does venture capital play?

In a field dominated by anecdote and folklore, this landmark study integrates more than ten years of intensive research and modern theories of business and economics. The result is a comprehensive framework for understanding entrepreneurship that provides new and penetrating insights. Examining hundreds of successful ventures, the author finds that the typical business has humble, improvised origins. Well-planned start-ups, backed by substantial venture capital, are exceptional. Entrepreneurs like Bill Gates and Sam Walton initially pursue small, uncertain opportunities, without much capital, market research, or breakthrough technologies. Coping with ambiguity and surprises, face-to-face selling, and making do with second-tier employees is more important than foresight, deal-making, or recruiting top-notch teams.

Transforming improvised start-ups into noteworthy enterprises requires a radical shift, from "opportunistic adaptation" in niche markets to the pursuit of ambitious strategies. This requires traits such as ambition and risk-taking that are initially unimportant. Mature corporations have to pursue entrepreneurial activity in a much more disciplined way. Companies like Intel and Merck focus their resources on large-scale initiatives that scrappy entrepreneurs cannot undertake. Their success requires carefully chosen bets, meticulous planning, and the smooth coordination of many employees rather than the talents of a driven few.

This clearly and concisely written book is essential for anyone who wants to start a business, for the entrepreneur or executive who wants to grow a company, and for the scholar who wants to understand this crucial economic activity.

About this title

About the Author

Amar Bhide, an associate professor on leave from Harvard Business School, is teaching at the University of Chicago. A former consultant at McKinsey & Company and proprietary trader at E.F. Hutton, Bhide received a doctorate and an M.B.A. from the Harvard Business School, where he was a Baker Scholar, and a B.Tech. from the Indian Institute of Technology. He has written eight Harvard Business Review articles, papers on corporate governance in the Journal of Financial Economics and the Journal of Applied Corporate Finance, and the book Of Politics and Economic Reality.

Reviews

Bhidecautions the reader that this is not a how-to book on the popular subject of entrepreneurship; rather, it looks at entrepreneurs mainly from an economic point of view. His work represents systematic research about starting and growing a new business, and Bhidecontends this approach is unique in the field. The book examines the nature of the opportunities that entrepreneurs pursue, problems and tasks they face, traits and skills they require, and the social and economic contributions they make; and then compares those realities with features of large, established companies. Entrepreneurs pursue opportunities with different levels of uncertainty, investment requirements, and likely profit. They survive and prosper because of an ongoing ability to adapt to opportunities and problems, are subjected to many detours, and stumble often along the way. This theory book will find a welcome reception in business schools that are focusing on courses in entrepreneurship and may also appeal to corporate executives who are trying to instill an entrepreneurial spirit in their employees. Mary Whaley

The entrepreneurial function has long been overlooked both by economists and business theorists, though courses in entrepreneurship are increasingly popular in business schools. Bhid? (Harvard Business Sch.) draws on both of those disciplines for theory, which he then extends through the analysis of data from 100 interviews with leaders of high-growth companies. This groundbreaking work shows the complementary roles held by innovative startup companies in areas with high uncertainty and little financial investment and by more established companies, which focus on large-scale projects with more certain payoffs. The characteristics of promising startups and their founders are carefully outlined and contrasted with those of more established firms, and Bhid? explains why so few firms make the transition from successful startup to ongoing large enterprise. Offering a wealth of avenues for future research as well as insights for potential entrepreneurs, this book is sure to be cited for years to come.
-A.J. Sobczak, Covina, CA
Copyright 1999 Reed Business Information, Inc.

Edition details

• Publisher: Oxford University Press
• Publication date: 2000
• ISBN 10: 0195131444
• ISBN 13: 9780195131444
• Binding: Hardcover
• Language: English
• Number of pages: 432