Economic growth and technological changes are often triggered by innovative entrepreneurs who discover, exploit, and explore undetected opportunities. However, before entrepreneurs can move forward they need capital in order to realize their business idea. In general, investors can be characterized as the gatekeepers who provide this financial bottleneck resource to entrepreneurs. Venture capital firms, in particular,
are a highly specialized group of investors which may also act as facilitators for innovations. Given that entrepreneurs and venture capitalists have been mostly studied in isolated cases, no integrative framework has yet been developed. Thus, this study aims to unfold the interconnectedness and dependencies of both parties and derives inter alia two important variables, namely strategic orientation and trust, which have been poorly
studied in this field, but are crucial for the long‐term success of the relationship. The structure of this study corresponds with the process which is characteristic for the relationship between the venture capitalist and the entrepreneur:
• The innovation process
• The strategy dimension
• The trust perspective
This study uses an adapted gatekeeper‐model by Csikszentmihalyi to reveal the different stages of the innovation process and to build a theoretical framework of the relationship between both parties. Through the complexity and the interconnection of all the different aspects it is designed as a “door opener” to a rich field of further research as well as it is aimed at helping practitioners understand the innovation process within a complex and dynamic environment.
Table of Contents
1. INTRODUCTION
1.1 Context and Relevance
1.2 Objective of the Study
2. THE INNOVATION PROCESS
2.1 Entrepreneurship and the Diffusion of Innovation
2.2 Systems Model of Innovation by Csikszentmihalyi
2.3 Investors in Innovation and Risk-Taking
2.4 The Venture Capital Business
2.5 Critical Summary and Conclusions
3. STRATEGY DIMENSION
3.1 Strategic Considerations of Venture Capitalists
3.2 Strategic Resources Approaches
3.2.1 Sustainable Competitive Advantage
3.2.2 Resource Dependence Approach
3.3 Sustainable Resource Management
3.4 Paradox Management
3.5 Critical Summary and Conclusions
4. THE TRUST PERSPECTIVE
4.1 Trust as a Concept
4.2 Models of Trust-Building
4.3 Trust-Control Duality
4.4 Levels of Trust
4.5 Critical Summary and Conclusions
5. DEVELOPMENT OF A FRAMEWORK
5.1 Venture Capitalists as Gatekeepers
5.1.1 The Innovative Entrepreneur
5.1.2 The Leapfrog Concept of Innovations
5.1.3 Gatekeeper Mechanism
5.1.4 Value Creation of Innovation
5.1.5 Critical Summary and Conclusions
5.2 The Sustainability Dimension
5.2.1 Relationship between Shareholders and Entrepreneurs
5.2.2 Direct Survival Resources
5.2.3 Stakeholder Management
5.2.4 Indirect Survival Resources
5.2.5 Sustainability Circuit
5.2.6 Critical Summary and Conclusions
5.3 Trust-Control Balance
5.3.1 The Trust-Building Process
5.3.2 Active Trust
5.3.3 Shared Visions
5.3.4 Critical Summary and Conclusions
6. THE GATEKEEPER-MODEL AS AN INTEGRATIVE FRAMEWORK FOR ENTREPRENEURS AND VENTURE CAPITALISTS
6.1 An Integrative Framework
6.2 Summary of the Implications of the Integrative Framework for Entrepreneurs and Venture Capitalists
6.2.1 Entrepreneurs
6.2.2 Venture Capitalists
6.3 Concluding Remarks
Research Objective and Key Themes
This thesis aims to create a comprehensive understanding of the factors that influence the decision criteria and relationships between entrepreneurs and venture capitalists within the innovation process, utilizing an adapted gatekeeper model to bridge the gap between financial control and long-term sustainable cooperation.
- The dynamics of the innovation process and the role of entrepreneurs as filters.
- The gatekeeper role of venture capitalists in identifying and fostering technological innovations.
- The strategic integration of sustainability and long-term resource management in venture capital.
- The importance of trust and its duality with control mechanisms in high-uncertainty environments.
Excerpt from the Book
2.1 Entrepreneurship and the Diffusion of Innovation
Entrepreneurship can be characterized as a process which is performed by someone who discovers, creates, and exploits opportunities to introduce future goods and services (Venkataraman, 1997). Research of entrepreneurship can be characterized by its multidisciplinary approach. Low and MacMillan (1988) refer to the multifaceted topic and state that “[the] phenomenon of entrepreneurship is intertwined with a complex set of contiguous and overlapping constructs such as management of change, innovation, technological and environmental turbulence, new product development, small business management, individualism, and industry evolution” (p. 141; added by the author). This diversity of thoughts makes it difficult to form a uniform definition of entrepreneurship and attribute what makes the entrepreneur so unique.
As Schumpeter (1939) suggests, being an entrepreneur is neither a profession, nor a lasting condition. Thus, it makes sense to approach the entrepreneur and entrepreneurship from the historical development of the term. Over the last three centuries, the term entrepreneur has fluctuated between being irrelevant (for neoclassic economics) and playing an essential role in economic development.
Hébert and Link (1989) contributed to the analysis of entrepreneurship in history by marking out the different periods that evolved over time. Richard Cantillon (1680-1734) was the first person to coin the term “entrepreneur” in an economical context. In the course of time different notions of entrepreneurship have emerged ranging from an uncertainty-bearer (Cantillon2, Knight2) who has to sell his goods at uncertain prices, a coordinator (Say2, Marshall2) who coordinates the production process, an arbitrageur (Kirzner2, von Hayek2) who perceives profit opportunities and tries to act upon them, to the innovator (Schumpeter ; see also Faltin, 2001) who takes an invention or an idea to exploit it commercially (see Hébert and Link, 1989). Over the course of the neoclassical period the term entrepreneur almost faded away from economic theory. The assumptions of the homo economicus and complete market led to a sole optimization problem which can
Summary of Chapters
CHAPTER 1: INTRODUCTION: This chapter introduces the context of venture capital as a dynamic industry and sets the primary research objective of developing an integrative gatekeeper-model.
CHAPTER 2: THE INNOVATION PROCESS: This chapter explores entrepreneurship as a driver of innovation and introduces the systems model by Csikszentmihalyi to explain how ideas transition into innovations.
CHAPTER 3: STRATEGY DIMENSION: This chapter examines strategic management approaches, emphasizing the need to balance short-term efficiency with long-term sustainability through paradox management.
CHAPTER 4: THE TRUST PERSPECTIVE: This chapter discusses trust as an essential intangible resource for economic exchange and conceptualizes its relationship with control mechanisms.
CHAPTER 5: DEVELOPMENT OF A FRAMEWORK: This chapter integrates previous findings to establish a framework for venture capitalists as gatekeepers, focusing on innovation, sustainability, and trust-control balance.
CHAPTER 6: THE GATEKEEPER-MODEL AS AN INTEGRATIVE FRAMEWORK FOR ENTREPRENEURS AND VENTURE CAPITALISTS: This final chapter synthesizes the study into an integrative model and provides actionable recommendations for both entrepreneurs and investors.
Keywords
entrepreneurship, venture capital, gatekeeper-model, business model, start-up, diffusion of innovation, technological change, leapfrog concept, value creation, Csikszentmihalyi, systems model, creativity, trust, sustainability, strategic management
Frequently Asked Questions
What is the core subject of this thesis?
The thesis focuses on the relationship between entrepreneurs and venture capitalists, specifically examining how venture capitalists act as "gatekeepers" of innovation in a complex, dynamic environment.
What are the central themes covered?
The central themes include the innovation process, strategic resource management, the role of trust in economic relationships, and the application of sustainability concepts within the venture capital industry.
What is the primary objective of this work?
The primary objective is to build an integrative framework based on a "gatekeeper-model" that helps both entrepreneurs and venture capitalists understand their dependencies and create more fruitful, long-term relationships.
Which scientific methods are employed?
The study utilizes a theoretical, literature-based approach, synthesizing concepts from management literature, systems theory, and sociology to develop an original integrative framework.
What does the main part of the work address?
The main part addresses the three pillars of the gatekeeper-model: the innovation process, the strategy dimension, and the trust perspective, ultimately applying these to create a comprehensive framework for investment and entrepreneurship.
Which keywords best characterize the research?
Key terms include entrepreneurship, venture capital, gatekeeper-model, innovation diffusion, strategic management, sustainability, trust, and resource-based view.
How does the "gatekeeper-model" define the role of a venture capitalist?
The model defines the venture capitalist as a "gatekeeper" who possesses the power to either reject or enable an invention to become a recognized innovation, thereby influencing the market entry process.
What is the "trust-control duality" discussed in the thesis?
The thesis argues that trust and control are not mutually exclusive (a dualism) but are instead interdependent and reinforcing (a duality), both being necessary for managing the high-risk, high-uncertainty relationship between venture capitalists and entrepreneurs.
- Citar trabajo
- Robert Hinsch (Autor), 2009, The Gatekeeper-Model of Innovation, Múnich, GRIN Verlag, https://www.grin.com/document/151558
