Dan K. Hsu

What matters, matters differently: a conjoint analysis of the decision policies of angel and venture capital investors

Prior studies have examined the importance of economic, strategic, and human factors to decision policies of angel investors and venture capitalists. As more angels professionalize into angel funds and as markets for technologies and ideas become more competitive, it is becoming more important to compare their decision policies with those of venture capitalists. Drawing upon agency theory, we examine whether economic potential, specific human capital, strategic readiness, and passion matter differently to venture capitalists and angel investors. Our study is an experimental conjoint analysis of more than 2700 investment decisions nested within a mixed sample of venture capitalists and angel investors. We find that strategic readiness for funding and affective passion matter more to angel investors, while economic potential matters more to venture capitalists. We also find that both investor types place similar weights on the specific human capital of entrepreneurs. These findings support the agency view that differences in the investment decision policies of angel investors and venture capitalists can be explained by examining the agency costs, market risks, information asymmetry, and control mechanisms that are structured into angel and venture capital deals.

Success, Failure, and Entrepreneurial Reentry: An Experimental Assessment of the Veracity of Self‐Efficacy and Prospect Theory

This paper develops and tests a model of an individuals intention to reenter entrepreneurship following business exit. Two long–standing theories, prospect theory and self–efficacy, seem to develop opposite predictions in this context. To reconcile these conflicting predictions, we theorize a moderating model and test the boundary conditions of both theories. Relying on two experimental studies, we find that prospect theory explains reentry intentions of entrepreneurs who have lost money when their self–efficacy is moderate or low. Thereby, we provide an explanation for the puzzling empirical finding that so many failed entrepreneurs reenter entrepreneurship even if failure has undermined their self–efficacy.

Designing Entrepreneurship Experiments

This article discusses the current and potential application of experimental methods to the study of entrepreneurship phenomena. Drawing on a review of experimental studies in entrepreneurship research, we discuss the advantages and disadvantages of experimental research designs for entrepreneurship research as a primer for those interested but not overly familiar with these methods. To advance research agendas and theory in the field, we introduce a typology of experimental manipulations that highlight alternative design choices based on the nature of their participant impact and realism of context. Finally, we provide an overview of areas of opportunity within the entrepreneurship literature for application of methods best suited to provide greater insight into the causal mechanisms at play.

To leave or not? The impact of family support and cognitive appraisals on venture exit intention

Purpose The purpose of this paper is to examine how family support affects challenge and hindrance appraisals, which in turn, influence entrepreneurs’ venture exit intention drawing on the challenge-hindrance job stressor model, family support, and the venture exit literature. Design/methodology/approach An experimental study (Study 1) was conducted to establish the relationships among family support, challenge and hindrance appraisals, and entrepreneurs’ venture exit intention. Two survey studies (Study 2 and Study 3) were conducted to extend the external validity of findings in Study 1 and to examine whether the theoretical framework holds in both the US and Chinese contexts. Findings All three studies demonstrate that family support decreases entrepreneurs’ venture exit intention by reducing hindrance appraisal. Study 3 also shows the mediating role of challenge appraisal in the family support – venture exit intention relationship. Originality/value This research contributes to the family embeddedness perspective not only by showing its relevance to the venture exit context but also by validating the relationship of family support with cognitive appraisals and venture exit intention in two cultural contexts. It also contributes to venture exit research by highlighting the unique role of cognitive appraisals in the formation of entrepreneurs’ venture exit intention.

Entrepreneurial intentions and start-ups: Are women or men more likely to enact their intentions?:

While empirical data clearly show that women are underrepresented among entrepreneurs, the causes of this gap are entirely not clear. This article explores one potential cause: that women might be less likely to act on their entrepreneurial intentions. Building on Ajzen’s theory of planned behaviour, we propose that intentions predict start-up behaviours, that is, that there is an intention–behaviour link. We then apply social role theory to propose that the intention–behaviour link is moderated by sex. Analysing data drawn from a sample of US-based management students during their first session in an introductory entrepreneurship course, at the end of the course, on their graduation and at a point up to three years after graduation, we find support for the intention–behaviour link and moderation of this link by sex. We identify additional contributions from our study and implications of our findings for addressing the sex gap in entrepreneurship.

‘This is my venture!’ The effect of psychological ownership on intention to reenter entrepreneurship

This paper examines why some individuals who started their ventures before would continue to pursue a subsequent entrepreneurial opportunity. I adopt the psychological ownership perspective and argue that some entrepreneurs reentered entrepreneurship after prior business exit because of their psychological ownership feelings for their prior ventures. Employing an online experiment with 104 entrepreneurs, affiliated with the entrepreneurship centers at two universities in the East Coast of the USA, I found that psychological ownership positively related to intention to reenter entrepreneurship. More importantly, this relationship was strengthened by the entrepreneurs prevention focus orientation.

An Investigation of Entrepreneurs' Venture Persistence Decision: The Contingency Effect of Psychological Ownership and Adversity

We incorporate psychological ownership theory and adversity literature to examine the joint effect of psychological ownership and adversity on entrepreneurs persistence decision. The results of two experiments and one survey show that both low adversity and high psychological ownership for the venture increase entrepreneurs likelihood of persistence. We also identify the moderating effect of adversity. Psychological ownership is more relevant to the likelihood of persistence when adversity is high than when it is low. Our research contributes to psychological ownership theory and the entrepreneur- ial persistence literature and has practical implications for entrepreneurs.