Please use this form to submit your study for inclusion into our database. It will be checked by a member of the Innovation Growth Lab team, who may be in contact to ask for more information. Your email address * Your name * Title * The name of the study Short summary A brief description of the project's goals and its current state Abstract <p>A classical approach to collecting and elaborating information to make entrepreneurial decisions combines search heuristics such as trial and error, effectuation, and confirmatory search. This paper develops a framework for exploring the implications of a more scientific approach to entrepreneurial decision making. The panel sample of our randomized control trial includes 116 Italian startups and 16 data points over a period of about one year. Both the treatment and control groups receive 10 sessions of general training on how to obtain feedback from the market and gauge the feasibility of their idea. We teach the treated startups to develop frameworks for predicting the performance of their idea and to conduct rigorous tests of their hypotheses very much like scientists do in their research. We let the firms in the control group, instead, follow their intuitions about how to assess their idea, which has typically produced fairly standard search heuristics. We find that entrepreneurs who behave like scientists perform better, pivot to a greater extent to a different idea, and do not drop out less than the control group in the early stages of the startup. These results are consistent with the main prediction of our theory: a scientific approach improves precision; it reduces the odds of pursuing projects with false positive returns, and raises the odds of pursuing projects with false negative returns.</p> The full abstract of the study, if available Links https://pubsonline.informs.org/doi/10.1287/mnsc.2018.3249 Links to any published papers and related discussions Authors * Affiliations Academic and other institutes that the authors of the study are members of Delivery partner Organisations involved in delivering the trial, if appropriate Year Year Year199419951996199719981999200020012002200320042005200620072008200920102011201220132014201520162017201820192020202120222023202420252026 Month MonthJanFebMarAprMayJunJulAugSepOctNovDec Day Day12345678910111213141516171819202122232425262728293031 Journal Journal publishing the study, if available Publication stage * Working Paper Published Ongoing Research Forthcoming Discussion Paper Research theme * Entrepreneurship Innovation Business Growth Country Country or countries where this study took place. Topics What sort of topics does the study cover? Sample attributes Hypotheses / research question What effect does entrepreneurship training based on teaching a scientific approach to decision making have on entrepreneurial success? Sample Trial population and sample selection The course was advertised through digital channels as a general course covering the important aspects of new venture creation – market sizing, business model creation and analysis, how to create a landing page, relevant startup data analytics and accounting. 164 nascent startups applied to take the course. A third have a business idea they want to develop further and the remaining are already at a development stage. However, none has developed or tested the idea to a significant extent. Most participant ventures are internet based companies (47%), followed by furniture (25%) and retail (9%). The remaining are spread across sectors like healthcare, food, leisure and machinery. Most ventures have two or three team members. Team members have usually completed college. Half of them were employed at the start of the programme. Overall, they have low levels of industry and managerial experience (about 2.5 years). And less than one year of experience working with or inside a startup. Participants are representative of the broader entrepreneurial community in the country. Number of treatment groups Size of treatment groups Size of control group Unit of analysis Clustered? Yes No Cluster details Trial attributes Treatment description Startups receive training and support from academic mentors , with those in the treatment being taught a scientific approach to developing and testing their business plans. Rounds of data collection Baseline data collection and method Firms that had an initial business idea but that had not begun any activity. Therefore any effect observed as they move into the program is de facto a difference-in-difference, because any variable regarding these firms before the intervention at a baseline level of 0, making the difference across firms before the intervention equal to 0. Data collection method and data collected Evaluation Outcome variables <p>Enterprise revenue, dropout rate of firms / entrepreneurs and the number of pivots to business models.</p> Results <p>Entrepreneurs that are trained to follow a scientific approach to evaluate and develop their business idea are slightly more likely to stop all activities related to their business idea (40% for those trained versus 35% for those untrained) within the nine month following the beginning of the training.</p> <p>Participants that are taught the scientific approach to decision making are more likely to pivot to a different idea from the one they originally had. While 49% of those trained pivot at least once, only 21% of untrained entrepreneurs do. </p> <p>Entrepreneurs that pivoted to new ideas as a result of the scientific approach training are more likely to acquire or activate customers afterwards.</p> <p>Within the first nine months, firms receiving the scientific approach component do not have higher odds of having positive revenue. However, positive revenues appear earlier for these firms and average revenue is higher. </p> <p>There is suggestive evidence that these effects are driven by an improvement in entrepreneurs' precision when predicting the viability of their idea.</p> Intervention costs Not available. Cost benefit ratio Reference Gambardella, A., Camuffo, A., Cordova, A. (2019). 'A scientific approach to entrepreneurial experimentation: evidence from a randomised controlled trial'. Citation for use in academic references
