Sharon A. Simmons

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.

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.

Perceptions of firm competitive advantages from teaming up with universities : an exploratory study

In the context of university collaborations, we know very little about why some firms perceive that teaming up with universities provide them with competitive advantages. One reason why we know so little is that university collaborations can take different forms and vary in terms of the nature of relationships, the motivation of parties and the outcomes that are expected from the collaboration. Another reason why is the lack of panel data that can be used to empirically study the competitive advantages that firms obtain from collaborating with universities. That said, the Kauffman Firm Survey (KFS) is a large dataset that asks firm owners about the competitive advantages of their firms and the reasons why they exist. In this paper, we use the KFS perceptual variables to explore the perception of firm owners about the competitive advantages of teaming up with universities. While there are limitations to the empirical conclusions that can be drawn, the research questions we explore using the KFS sample provide interesting avenues for future research.

Competitive Advantages of Formality in the Informal Economy

In developed economies like the United States, formal firms arguably have the choice as to whether or not to compete against informal firms. In emerging economies like Africa, however, formal firms are often times pushed into competition with informal firms for market share. Informality can be a difficult context for formal firms to navigate. Prior research has emphasized the role of embedded social networks and cultural customs of doing favors as some of the disadvantages of the formal mode of doing business in developing and emerging economies. To compensate, some formal firms imitate the resource orchestration of informal firms. Informality, however, also has disadvantages. Building upon resource based theory, we hypothesize that informal firms pose less of a competitive threat to the formal firms that deploy formal information resources such as websites and national quality certifications. In other words, rather than imitating the informality that is prevalent in emerging economies, formal firms can substitute informal modes of doing business with strategic assets that informal firms are constrained from orchestrating. We empirically test and found support for our hypotheses using a large sample of 7,576 formal firms doing business in 18 Sub-Saharan African countries.

Cognitive Dispostion for Serial Entrepreneurship

The intention to become a serial entrepreneur can be influenced by both situational and dispositional factors. Considerable emphasis in this literature has focused on the situational factors such as prior business successes and failures. In this paper, we integrate theoretical and empirical research on serial entrepreneurship with regulatory focus theory to determine whether dispositional regulatory orientation predicts serial entrepreneurship intentions, and how those dispositional orientations are influenced by situational cues. We conducted an experimental study of 74 experienced entrepreneurs to test our proposed relationships. Our results indicate that a negative relationship between dispositional prevention focus and serial entrepreneurship intentions is strengthened following our experimental manipulation of business failures. Conversely, we also found a positive relationship between dispositional promotion focus and serial entrepreneurship intentions with no significant effects from success or fai...