Effectuation Entrepreneurship report of Anthony Pantoja for ENTREP

1. Effectuation Entrepreneurship

2.  Framework for entrepreneurial thinking
 Common way of problem solving used by
expert entrepreneurs
 Idea
 Sense of purpose

3.  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)

4. Expert Entrepreneurs…
 Limit risks by understanding what they can
afford to loose
 Create their own market opportunity
 Trust people

5.  Effectual thinking can be taught
 Failure increases the odds of individual
success
 Entrepreneurial thinking can be taught

6.  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

7.  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

8.  Affordable loss principle
 Set affordable loss
 What is my threshold?
 Evaluate opportunities based on whether the
downside is acceptable

9.  Lemonade principle
 Embrace surprises that come from uncertainties
 Be flexible
 Don’t be tied down to your goals – ADJUST
 Have a back up plan

10.  Crazy quilt principle
 Build partnerships with people, industries and
 How do I go about lack of strategic planning,
uncertainties, and problems?

11.  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

12.  http://www.effectualentrepreneurship.com/effectuation-
introduction/
 www.google.com.ph/url?sa=t&rct=j&q=&esrc=s&source=web&cd
=1&sqi=2&ved=0CFEQFjAA&url=http://www.reebrasil.org.br/asse
ts/files/materiais/SarasSarasvathy_Teaching-
Effectation.pdf&ei=g4nBT9isIKetiQfkhemZCg&usg=AFQjCNEyld
YfpIIwXV8_HBJkNwSEGvSPDw&sig2=5tbYw3WGEgeaOXd5e7MT
Lw
 http://www.google.com.ph/url?sa=t&rct=j&q=&esrc=s&source=we
b&cd=2&ved=0CFIQFjAB&url=http%3A%2F%2Ffaculty.darden.vir
ginia.edu%2FSarasvathyS%2Fdocuments%2F0_Own%2520Notes
%2FBird%2520in%2520hand.doc&ei=0ZHBT_jXLsOtiAfv1aSNCg
&usg=AFQjCNElrHBwnPnQK6c2LjvOGcA_yfnycQ&sig2=tvGo7Ipb
jYlnTRpab3KOlA