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Article
Publication date: 1 March 2010

Joseph R. Bell

Book review by Joseph R. Bell. Patzelt, Holger and Thomas Brenner, eds. Handbook of Bioentrepreneurship. New York: Springer, 2008. ISBN 9780387483436The Handbook of…

Abstract

Book review by Joseph R. Bell. Patzelt, Holger and Thomas Brenner, eds. Handbook of Bioentrepreneurship. New York: Springer, 2008. ISBN 9780387483436

The Handbook of Bioentrepreneurship represents volume 4 in the International Handbook Series on Entrepreneurship.This book is a collection of articles covering the rapidly evolving biotechnology industry.

Details

New England Journal of Entrepreneurship, vol. 13 no. 1
Type: Research Article
ISSN: 2574-8904

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Article
Publication date: 15 October 2008

Holger Patzelt and David B. Audretsch

The purpose of this paper is to study the development of the biotechnology industry at the industry and firm level when the financing environment becomes hostile and…

Abstract

Purpose

The purpose of this paper is to study the development of the biotechnology industry at the industry and firm level when the financing environment becomes hostile and assess the reasons for this development.

Design/methodology/approach

An organizational evolution perspective to analyze the case of the German biotech sector was applied and its response to the hostile financing environment in the years 2002‐2004, which followed the burst of the high‐tech bubble at the stock markets. Population ecology and data from biotech reports to investigate the pattern of external adaptation processes at the industry level were used. The evolutionary economics perspective, multiple case studies of bioventures, and biotech reports to study internal adaptation processes at the firm level was employed.

Findings

The assumption of both external and internal adaptation processes was found in parallel is necessary to explain the evolution of the biotech industry in a hostile financing environment. Although external adaptation takes place to some extent through insolvencies and a reduced rate of new firm foundations, many bioventures adapt internally by downsizing, changing their business models, and entering into strategic alliances and M&As. This results in surprisingly weak consolidation at the industry level.

Originality/value

This paper provides an explanation why the consolidation of the German biotech industry in 2002‐2004 was much weaker than expected by experts. Moreover, the paper shows that application of population ecology and evolutionary economics in parallel well describes industry evolution and organizational change. Finally, the paper demonstrates how bioventures can adapt their financing strategies to hostile environments.

Details

Journal of Organizational Change Management, vol. 21 no. 6
Type: Research Article
ISSN: 0953-4814

Keywords

Content available
Article
Publication date: 15 October 2008

Slawomir Magala

Abstract

Details

Journal of Organizational Change Management, vol. 21 no. 6
Type: Research Article
ISSN: 0953-4814

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Article
Publication date: 23 September 2013

Ethel Brundin and Veronika Gustafsson

The purpose of this paper is to investigate entrepreneurs’ investment decisions under uncertainty in continued investments where the authors test the role of emotions to…

Abstract

Purpose

The purpose of this paper is to investigate entrepreneurs’ investment decisions under uncertainty in continued investments where the authors test the role of emotions to continue or discontinue the investment.

Design/methodology/approach

A conjoint analysis is carried out on 101 entrepreneurs’ 3,232 investment decisions. The entrepreneurs were provided with a scenario of an investment where the dependent variable was the entrepreneur's propensity to allocate further resources to the described investment. They assessed their willingness to allocate further resources to the investment on a seven-point Likert-type scale. The independent variables in the experiment were the experienced emotions of the entrepreneur each of which was described by the two levels of high and low.

Findings

It was found that self-confidence, challenge, and hope increase the propensity to continue investments as do increased level of uncertainty. Embarrassment and strain do not increase this propensity, however, high uncertainty decreases the propensity to continue investments. In contrast to the escalation of commitment theory, embarrassment does not make entrepreneurs more prone to invest under uncertainty. Frustration does not yield significant results, which runs contrary to the theory and the hypothesis finds no support.

Research limitations/implications

The paper focussed on a limited number of emotions, and also on one specific moderating factor that impacts the effect of these emotions on the investment decision.

Practical implications

To understand the role of their emotions in investment decisions under different levels of uncertainty may help entrepreneurs to improve the quality of their decision making.

Originality/value

This study is an experiment where practitioner entrepreneurs participate which increases the ecological validity of the study. Emotions can explain, partly, why entrepreneurs persist with some underperforming projects, but not others. Uncertainty is a powerful moderating variable in the decision-making process. The results enhance existing knowledge about the emotive side of entrepreneurs’ propensity to make investment decisions under uncertainty. The results also supplement and refine existing theories on self-justification.

Details

International Journal of Entrepreneurial Behavior & Research, vol. 19 no. 6
Type: Research Article
ISSN: 1355-2554

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