Entrepreneurs hate business planning

Most entrepreneurship programs are organized around the development of a business plan. This is understandable because the first thing entrepreneurs are asked for when they apply for a bank credit or venture capital is a business plan. Although many entrepreneurs have made a business plan one could question their attitude towards this ‘obligation’. Albert Shapiro concluded that “companies that plan do better than companies that don’t but they never follow their plan” and Mc Kinsey stated that “it is not so that winning businesses don’t make plans but they refuse to let planning become an end itself”.

Why business planning?

The added value of business planning is not to predict the future but to think about possible futures for today’s decision making. Of all the business plans made by the entrepreneurs that I supported, I found none realized exactly according to this plan. “In fact, business planning and market research do not fit to the natural behavior of successful entrepreneurs”, is one of the conclusions of Saras Sarasvathy, a key trainer in VentureLab International. In her research among around 30 expert entrepreneurs in the world, she found that these entrepreneurs follow another approach. They hate systematic market research and planning and prefer to discover in practice how they can be successful.

If not what then?

They make use of opportunities which arise and adapt their approach continues to the market responses. Sarasvathy called this the “Effectuation” approach as opposed to the usual “Causation” approach in which business planning plays an important role. Her findings are more and more recognized at entrepreneurship support centers, educational and research institutions. One of these is the Dutch Institute for Knowledge Intensive Entrepreneurship (Nikos) which applied this approach in the
VentureLab program.

So: Get inspired by Saras Sarasvathy! In an interview at VentureLab, she explains her approach. For me and many other Venturelab participants, it was a ‘party of recognition’.

 

 

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Crowdfunding Now and In The Future

Crowdfunding by definition is “the process of financing an activity or endeavor by way of generating lots of modest sums of capital from a huge number of persons, generally by using the Internet”.

We seem to be in a constant recession wave so nowadays start-ups are under huge pressure to remain profitable, and business owners are not going through the best of times. Crowdfunding creates a good possibility for success for this kind of entrepreneurs and businesses, by displaying their initiatives and assignments to the whole global community. The infographic shown below designed by Eventstir, events crowdfunding service, gives an excellent review of the global crowdfunding arena. It includes broad subject areas, such as the total amount of funds generated and platform explanation by region, along with specific parts of the world, together with the greatest platforms and ventures.

The Internet isn’t “about” anything anymore, and it never will be again. In the past, we were told that it was about empowerment, personalization, rapid information exchange, getting goods and services on demand, and a host of other descriptions designed by marketing departments to cause companies to panic. Everyone thought that if they weren’t part of that year’s steamroller, they would become part of that year’s road.

That is behind us. The Internet is still about all those things, of course, and about dozens of other contradictory things as well. In the end, the only thing the Internet is about is moving digital data at low cost. Consequently, once we realize that the number of uses that people have found for being able to move digital data at low cost has become so staggeringly various that there’s no way to draw it together in a single phrase or movement. We can finally say “game over.”

As the madness of the great bull market, it is no longer possible to imagine that Amazon and Aabra-kadaabra.com are in the same kind of business because they both sell books over the Internet or that e-steel.com and pashmina.com are similar businesses because of they both end in .com. Now we’re left with the world where an online bookstore is a bookstore, and a car company that buys steel over the Internet is a car company. The Internet is going away like the phone went away, permeating everything and, in the process, becoming invisible.


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