Anthony Pantoja

Effectuation Entrepreneurship

Effectuation

Framework for entrepreneurial thinking

Common way of problem solving used by expert entrepreneurs

Idea Sense of purpose

History of Effectuation

Developed by Saras Sarasvathy (University of Virginia Darden Graduate School of Business

Research Gave expert entrepreneurs a

problem set Wide array of participants from ice

cream to steel Responses were documented (video

taped and transcribed)

Findings from the Research

Expert Entrepreneurs…

Limit risks by understanding what they can afford to loose

Create their own market opportunity\ Trust people

Findings from the Research

Effectual thinking can be taught Failure increases the odds of

individual success Entrepreneurial thinking can be

taught

Causal vs. Effectual Thinking

Causal thinking = Managerial thinking Choosing the best means to achieve a

goal

Effectual thinking = Entrepreneurial thinking Imagining possible new ends using a

given set of means

Principles of Effectual Entrepreneurship

Bird in the hand principle Who I am What I know Whom I know Start with your means; don’t wait for the

perfect opportunity

Principles of Effectual Entrepreneurship

Affordable loss principle Set affordable loss What is my threshold? Evaluate opportunities based on whether

the downside is acceptable

Principles of Effectual Entrepreneurship

Lemonade principle Embrace surprises that come from

uncertainties Be flexible Don’t be tied down to your goals –

ADJUST Have a back up plan

Principles of Effectual Entrepreneurship

Crazy quilt principle Build partnerships with people,

industries and How do I go about lack of strategic

planning, uncertainties, and problems?

Principles of Effectual Entrepreneurship

Pilot in the plane principle Focus on activities within your control Control vs. predict Believes that the future is neither found

nor predicted The future is made

Reference

http://www.effectualentrepreneurship.com/effectuation-introduction/

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