Co-constructing an Opportunity with a Community of Inquiry

Entrepreneurs can learn about potential opportunitiesthrough social interactions with communities of inquiry. However, how do entrepreneurs build such communities, and how do they engage community members over time to develop their potential opportunities? Building on a recent study of eight new ventures and their communities of inquiry over nine months (Shepherd et al. in Journal of Business Venturing, 106033), this chapter presents a social model of opportunity development. The chapter explains how entrepreneurial teams that progress well toward market launch consist of varied specialists who openly engage their communities of inquiry. This open engagement leads such teams to gather diverse information, generate multiple alternatives (technology and market), and test conjectures about their potential opportunities through disconfirmation. In contrast, unsuccessful entrepreneurial teams rely on focused engagement with their communities of inquiry. This focused engagement leads these teams to gather specific information, generate a few related alternatives, and seek to confirm their opportunity conjectures. This chapter highlights new insights into entrepreneurial teams’ engagement with communities of inquiry to explain opportunity development and, ultimately, new venture progress.

Scaling New Ventures

Although scaling is a “hot topic” in the practitioner literature, it has mostly been ignored (at least explicitly) in the academic literature. Building on a recent editorial, this chapter highlights the importance of scaling for new venture growth. Scaling refers to spreading excellence within a venture as it grows (organically or through acquisition) from a new (and often small) organization to an established, large organization (Shepherd & Patzelt in Entrepreneurship Theory and Practice, 10.1177/1042258720950599, 2020). In this chapter, we explore the drivers and consequences of scaling and explain how knowledge management facilitates scaling, how founder replacement impacts scaling, and how current scaling influences subsequent scaling.

Managing New Ventures

The creation of new ventures and growing them into well-established organizations is the key purpose of managing new ventures. This chapter explains the 10 most essential subtopics for managing new ventures (Shepherd et al. in Journal of Management 47:11–42, 2021): (1) lead founder, (2) founding team, (3) social relationships, (4) cognitions, (5) emergent organizing, (6) new venture strategy, (7) organizational emergence, (8) new venture legitimacy, (9) founder exit, and (10) entrepreneurial environment. This chapter ties these “managing” subtopics into the three major stages of the entrepreneurial process—co-creating, organizing, and performing. The framework provides a cohesive story of managing new ventures.

Attending to the External Environment to Identify Potential Opportunities

Building on a recent study (Shepherd et al. in Strategic Management Journal 38:626–644, 2017), this chapter highlights the importance of noticingopportunities as an initial step toward new venture creation. Unsurprisingly, there has been considerable interest in the processes of allocating attention to notice potential opportunities arising from changes in the external environment. We know a great deal about the role of top-down (i.e., based on knowledge and experience) processes of allocating attention to the environment in forming opportunity beliefs worthy of entrepreneurial action. However, in this chapter, we illustrate how bottom-up processes, whereby environmental changes capture entrepreneurs’ attention, shape opportunity identification. Building on the notion of guided attention, we detail an attention model of forming opportunity beliefs for entrepreneurial action that includes both top-down and bottom-up processes for allocating attention. This chapter explains how entrepreneurs can allocate their transient attention to identify potential opportunities from environmental changes. This chapter also describes how allocating sustained entrepreneurial attention influences belief formation about radicaland incremental opportunities requiring entrepreneurial action.

A Lean Framework for Starting a New Venture

The lean startup framework is one of the most popular contributions in the practitioner-oriented entrepreneurship literature. This chapter builds on a recent paper (Shepherd & Gruber in Entrepreneurship Theory and Practice. 10.1177/1042258719899415, 2020) to highlight new insights into how new ventures are started based on the lean startup framework. Specifically, we describe the origin of the lean startup framework and its five main building blocks—(1) identifying and evaluating market opportunities in startups, (2) designing business models, (3) engaging in validated learning (including customer development), (4) building minimum viable products, and (5) learning whether to persevere with or pivot from the current course of action. We organize these building blocks into a framework suggesting how considering the contextual characteristics of and the interdependencies between the building blocks can enrich our understanding of using the lean startup framework to start a new venture.