Biography of entrepreneurs pdf free

Maastricht School of Management Entrepreneurship Individual Assignment Name - Parth Chauhan (40036157) Group Members - Sultana Haque (40014159) & Devim Adiguzel (40038713) Batch - MBA 35 Year - 2018 2 Contents 1. 2. Introduction .......................................................................................................................................... 3 1.1 About Admesy ............................................................................................................................... 3 1.2 About Steven Goedstouwers ........................................................................................................ 4 Venture Biography and Themes ........................................................................................................... 4 2.1 Understanding entrepreneurship ................................................................................................. 4 2.1.1 The journey ........................................................................................................................... 4 2.1.2 Decision Making .................................................................................................................... 5 2.1.3 The Global Approach............................................................................................................. 5 2.2 Opportunity discovery and development ..................................................................................... 5 2.2.1 Reporting Manager ............................................................................................................... 5 2.2.2 Discovery vs. creation ........................................................................................................... 6 2.2.3 Connecting the dots .............................................................................................................. 7 2.3 Technology or market needs as a source of opportunity ............................................................. 7 2.3.1 Schumpeterian and Austrian school of thoughts ................................................................. 7 2.3.2 Lean Startup vs. Design Thinking .......................................................................................... 8 2.4 Opportunity validation and selection ........................................................................................... 8 2.5 Business Model ............................................................................................................................. 9 2.5.1 2.6 Antecedents of the Business Model ................................................................................... 10 Business Plan............................................................................................................................... 11 2.6.1 Strategy ............................................................................................................................... 11 2.6.2 Sustainability ....................................................................................................................... 11 2.7 Mobilizing resources ................................................................................................................... 12 2.8 Scaling up .................................................................................................................................... 13 3. Conclusion ........................................................................................................................................... 14 4. Exhibits ................................................................................................................................................ 15 4.1 Group Picture .............................................................................................................................. 15 4.2 Business Card .............................................................................................................................. 15 References .................................................................................................................................................. 16 3 1. Introduction This paper is an attempt to establish a link between the understandings of the entrepreneurship course of MBA 35 at the Maastricht School of Management taken by Prof. Wynand Bodewes and the journey of an actual entrepreneur, in this case Mr. Steven Goedstouwers, the CEO of Admesy B.V. The entrepreneurial journeys of Admesy as well as Steven have been covered using the eight themes that were introduced during the course with the support of lectures, slides, assigned readings and some additional resources. Some of the episodes and events of the ‘venture biography’ would be repeatedly mentioned during this paper and that is because of the relevance to a particular theme. After a lot of emails and phone calls to various entrepreneurs, one of our group members finally managed to schedule an interview with Mr. Steven on a Tuesday afternoon for this project. For the discussion, we designed a questionnaire with our shared understanding of the concepts and themes like opportunity, funding, scaling up, mind-set and motivations. Mr. Steven was very humble and patient during the whole discussion and tried his best to help us understand whatever we asked. For us as a group, it was a great learning experience interacting with him and getting to learn about the challenges faced and tackled by an entrepreneur. The understanding of the concepts and their link to the entrepreneur have been shown in this paper with the help of the assigned readings and own reflections together. 1.1 About Admesy Admesy was born out of a specific problem faced by 2 engineers working in the hand-held display manufacturing facility of Philips in Heerlen. The problem: products like mobile phones, camera and navigation devices that have a small display need to be calibrated in terms of color, contrast and brightness in the same measurements before they hit the market. This ensures a uniform quality and appearance of the products to the customers. The task of checking these measurements was being done manually till 2006 (before Admesy came into existence) and since it couldn’t be a sampling activity, every device had to be checked separately. This often resulted in slow production yields, errors due to human fatigue and many such related problems on the production floor which in turn risked the brand image of many organizations. With their experience in display, light and sensors these engineers thought of a product that could automate the process of checking these measurements: colorimeters. First, they tried to approach their managers in Philips, but were turned down. Then they approached LIOF, an investment firm for seeking funding for their concept, where Steven was their investment manager and even he sent them back suggesting them to re-work the plan. And finally after a year of rework and planning, when they went back to Steven, not only he believed in their idea and invested in it, he was also made a member of their advisory board. The two founders pulled in one more engineering friend into the venture, and Admesy B.V. was hence started as a company in 2006. Steven worked in LIOF as an investor and maintained his position in Admesy as a part time advisor for 6 and half years until 2012 when the founders got into a disagreement regarding the strategy of the company and management in light of some new bigger electronic customers. The rift between the founders resulted in one of the founders (who was handling the general management and business) 4 quitting the company and Steven was asked to join as the CEO by the remaining 2 founders. Steven accepted the offer, quit LIOF and joined Admesy as an entrepreneur. In the last 11 years and especially after Steven coming on board, the company has grown in every possible direction, more products, clients, employees, geographies and a better stronghold of the photonics industry where they function in. We will further see the story get unfolded as we progress in this paper. Today, Admesy offers a broad range of test and measurement instruments focused on color and light measurements in all environments ranging from the R&D labs to the production floor (source: https://www.admesy.com/about) 1.2 About Steven Goedstouwers Steven’s education is a mix of technical, psychological and business studies but a major focus for him was always entrepreneurship as a subject. After graduating he worked with the incubation department of the Maastricht University for almost 2 years, after which he realized that the environment for him was not suitable there. He went on the join LIOF, an investment company as an investor where after working for 2 years, he was given the complete autonomy for handling startup funds. There he acquired a lot of knowledge about small businesses, start-up ventures, industries, financing and of course entrepreneurship from a second-person perspective. So, entrepreneurship was not something new for Steven but he himself actually became an entrepreneur when he joined Admesy as the CEO in the mid of 2012. We will further get to know about Steven in this paper. 2. Venture Biography and Themes 2.1 Understanding entrepreneurship 2.1.1 The journey As mentioned above, Admesy was formed when 2 engineers from Philips came together to create a product that can substantially improve the production yield of checking displays for the manufacturing facilities of big organizations like Samsung (Goetstouwers, 2018), we observe that the process of this entrepreneurial venture can be referred as entrepreneurial valorization (Bruyat & Julien, 2000) where these engineers while working in a big enterprise like Philips were already exposed to cutting edge technology and innovation, were able to identify a gap in the market and were able to act upon it fast enough to start a venture that fills that gap. Steven on the other hand was involved as an investor initially and an advisory board member till he finally came on board as the CEO. While all three founders had a technical background and had to take different roles within the venture, Steven on the other hand had an experience precisely in analyzing start-up ventures through a perspective of an investor and growth agent. This definitely gave an edge to Steven to scale up the business further and make some radical strategic decisions for Admesy which weren’t taken before him in the company. 5 2.1.2 Decision Making Admesy’s entrepreneurial journey shows the use of the two logics of effectuation and causation for strategic decision making as discussed by Sarasvathy (Reyman, Andries, Berends, Mauer, Stephan, & Burg, 2015). While most venture go through a mix of both the logics over their lifetime, at Admesy the two can be distinguished at two different points in times. At the start of the venture back in 2006 the founders started by analyzing the need of the market, competitors, setting a goal and then finally starting a company and that shows causation, while after 6 years when the founders got into a rift and one of them had to quit, the company found itself in a situation that wasn’t planned (Goetstouwers, 2018). To make the best of out of the situation, the founders approached Steven, who was one of the stakeholders in the company as an advisor to run the business-related functions of the company given his extensive experience in the startup space as an investor and analyzer shows the effectuation logic of decision making (Reyman, Andries, Berends, Mauer, Stephan, & Burg, 2015). One of the cases discussed in the lectures about CM also shows how effectuation shaped the venture into a successful company over the period of time by grabbing various opportunities that came along whereas a more causal approach by ThreeFive Photonics ultimately lead them into difficulties (Bodewes, 2018). This by no means shows that one approach is better than the other but signifies that the decision making approach depends a lot on the nature of the product or business or situation in itself. One of the factors being risk and resources (Reyman, Andries, Berends, Mauer, Stephan, & Burg, 2015), while CM required very less capital to begin with its business that uses effectuation logic, ThreeFive and Admesy both being in the photonics industry had to start with a considerably large capital size to start their operations and hence needed to plan their sources of funding, and that shows causation. 2.1.3 The Global Approach As mentioned in the various examples of the journal ‘The Global Entrepreneur’ by Danieal J. Isenberg, Admesy started as a global venture on its Day 1 (Isenberg, 2008). Their major clients were production facilities of large technology firms mostly based out of south-eastern Asian countries like China, Taiwan and South Korea. Though based out of the Netherlands, Admesy just has about 2% business in Europe and even a smaller fraction in the U.S., the raw material and components used to manufacture their devices are mostly sourced from in around Netherlands and not from popular sources like China. Being born global gave an advantage to Admesy to better understand more customers, creating a niche and being one of the two market leaders in the color and light sensor products. While their major workforce is stationed in Ittervoort, Netherlands, they have regional offices in China and South Korea with a modest strength of 5-7 personnel to give logistics support and handle customer relations. 2.2 Opportunity discovery and development 2.2.1 Reporting Manager While the founders of Admesy saw an opportunity as a market gap in the manufacturing and production industry, one of the major reasons for them to start their own venture would also have to be attributed to their managers in Philips who firstly, failed to recognize the opportunity themselves and secondly, couldn’t support their reporting staff with the entrepreneurial idea (Premuzic, 2012). This doesn’t mean that the leadership was out rightly bad but in most large organizations entrepreneurial talent is not 6 appreciated since an entrepreneurs’ vision often tends to diverge from the organizational goals and objectives. 2.2.2 Discovery vs. creation It is very difficult to categorize the birth and growth of the company under discovery or creation theories but let us try to analyze some of the effective entrepreneurial actions with respect to Admesy (Alvarez & Barney, 2007):  Leadership The founders of Admesy used to work in a handheld display division of Philips in Herleen where they identified the problem of checking screen calibrations and the need of a faster mechanism to do that (Goetstouwers, 2018). Being software and electrical engineers working in a highly technological company is a clear proof that they had expertise and experience in the field for which they identified the problem and it shows a discovery context of the leadership (Alvarez & Barney, 2007).  Decision Making For more than six years after starting the company, Admesy remained majorly a technological company with mostly engineers as the working staff (Goetstouwers, 2018). While dealing with small clients the company didn’t require taking big and bold decisions with bigger risks (discovery context) but that changed after the company got bigger clients that required incremental decisions, like getting a clean room which we know from the ThreeFive photonics case is a big investment (Bodewes, 2018). Steven with his experience and expertise in business was able to bring in the creation context in decision making as opposed to a discovery context before him (Alvarez & Barney, 2007).  Human Resources Practices For the first six years, the company majorly hired engineers as the staff but as their clients and market diversified their hiring diversified as well, one of the major ones being Steven himself, a non-engineer being hired as the CEO.  Strategy While from the start of its inception and till date Admesy’s strategy has been of a discovery context which is majorly focused on manufacturing color measurement devices (colorimeters), over the period of time the company has opened up to various other products and industries like light meters, spectrometers, accessories etc. and is also absolutely open to explore newer opportunities in the future (creation context) (Goetstouwers, 2018).  Finance The nature of the business and the amount of capital required to start a technology company absolutely puts Admesy under the discovery context (Alvarez & Barney, 2007) since the initial capital of 2 million to set up the company was raised through banks and venture capitalists and not by bootstrapping (Goetstouwers, 2018). 7  Sustaining Competitive Advantages Though many of the previous tools show the company bent towards the discovery context, the company sustains competitions in the market without being absolutely secretive or hidden from competition or the world. The company owns no major patents as such but still faces just one major competition. Steven attributes this sustainability to firstly; the niche segment that they operate in and secondly, to the research and learning the company has been doing for over the decade (Goetstouwers, 2018). 2.2.3 Connecting the dots Alertness is also one of the major factors for the company to identify opportunity and get started. The engineers at Philips happened to discover and create a product because they saw the problems of break downs and low yields faced at the display production facilities (Baron, 2006). Steven on the other hand became an entrepreneur at a later stage of the company bringing in a lot of empirical knowledge from his previous experiences. His skills were required at the time when the company started dealing with bigger electronic players in the market. This also shows the alertness of the founders in terms of managing uncertainty (Bodewes, 2018). 2.3 Technology or market needs as a source of opportunity The last 2-3 decades have shown the world the power of technology (especially internet) and how it can substantially ease human lives. And both technological and non-technological companies have embraced this transition to sustain in the highly competitive environments. Not only the rapidly advancing technology has helped organizations improve their traditional way of working but extreme conditions like competition and policy change have also created new ideas and hence have given birth to new markets altogether. A lot of opportunity thus lies in the adversity (Radjou, Prabhu, & Ahuja, 2012). Tech companies are usually easier to set up in scarcity since they require less of everything like people, space and regulations (Berman, 2016). But in case of Admesy, even when it is a technology company, their product was a hardware device and that required precision in manufacturing and hence required more capital. 2.3.1 Schumpeterian and Austrian school of thoughts In case of Admesy as well the idea was born because of an adversity recognized by the engineers working at Philips. They discussed the potential of the idea with their managers but were eventually turned down which propelled them to an entrepreneurial path (Goetstouwers, 2018). But even after taking in all the considerations and difficulties into account, the conceptualization and eventually creating a product didn’t disrupt the market as such or promoted disequilibrium, which shows an Austrian school of thought of entrepreneurship. Also, their product reduced the gap between the leaders and followers unlike to what happens in a Schupeterian entrepreneurship (Cheah, 1990). At the same time, as the Schumpeterian school suggests the product did disrupt the traditional way of manual display calibration measurement and introduced an automated way of performing the checking. This shows that indeed the two schools of thought complement each other in various contexts and situations (Cheah, 1990). 8 2.3.2 Lean Startup vs. Design Thinking As a different example, mobile phone companies like Oneplus and Xiaomi took over the market share in a very short period of 3-5 years with competitions like Samsung and Apple already being present in the market from a longer period of time. Before we discuss about Admesy, let us understand what the difference between Oneplus and Samsung is and how lean startups and design thinking play a role (Mueller & Thoring, 2012): “It is quite a story how Oneplus mobiles was able to quickly acquire a large market share in just 5 years with huge players like Apple and Samsung already present there as competitors. Being a smaller company and they were able to better connect with their consumers and receive feedback. Based on these feedbacks, they worked extensively and negotiated with their suppliers to reduce costs and deliver a product that their customers precisely wanted. For bigger companies like Apple and Samsung, the distance between them and the consumers is large, and instead of getting feedbacks and building the product they impose their own ideas onto the consumers” (Chauhan, 2018). Thus, Oneplus shows an approach of customer centricity captured both in lean startups and design thinking (Mueller & Thoring, 2012). While the above example shows the commonalities of the two approaches, the start of Admesy appears to be more of a ‘lean startup’ where a high-tech innovation was developed for customers at the production facilities and not end users (Mueller & Thoring, 2012). Also the business model is simple but important for the company (discussed further in detail) shows a lean startup. At the same time consistent customer feedbacks and constant research for product development, diversification in other industries and the fact that the product was born out of a challenge shows ‘design thinking’. While ideation for new product developments is both iterative and pivotal if viewed in different contexts. It is very difficult to distinguish the company on just one approach, hence just like the Schumpeterian and Austrian schools of thought, for Admesy ‘lean startup’ and ‘design thinking’ complement each other (Bodewes, 2018). 2.4 Opportunity validation and selection The attractiveness of the opportunity recognized by Admesy at different points of time varies a lot depending on the different cognitive frameworks of the people involved at various capacities (Gruber, Kim, & Brinckmann, 2015). The founders of the company being engineers possessed a very product oriented approach and this was evident from the point they first pitched the idea to their investor, in this case Steven when he was working at LIOF. In a way people like Steven who study business plans to make decisions about funding bring in the entrepreneurial and business oriented focus that technologists usually lack. According to Steven, when the founders first pitched in the idea, it was rejected due to a weak business plan. Only after a year, the founders were able to make a better plan and were able to convince Steven to not only invest but also to become one of the members in the advisory board of the company (Goetstouwers, 2018). Also, it is important to acknowledge that people with different backgrounds and experiences will evaluate and select opportunities differently (Bodewes, 2018) and this difference can often lead to growth for a company. The on-boarding of Steven also shows the amount of information that Admesy would have got about different small ventures, businesses, 9 partners and customers at a time when the company was struggling with uncertainty (Kuechle, Reshef, & Carr, 2016). The company grew to a moderate size both in terms of business and the number of people it employed in the first 6 years of its existence (Goetstouwers, 2018). But, due to the functional backgrounds of the founders, the focus always remained on the product and less on exploring further business opportunities (Gruber, Kim, & Brinckmann, 2015). Things changed when the company got a big electronic firm as their client in the mid of 2012 (Goetstouwers, 2018). The founders got into disagreement regarding their future strategies and decision making which can again be attributed to the similar kind of mental models they all possessed (Gruber, Kim, & Brinckmann, 2015). The rift between the founders resulted in one of them quitting the firm and Steven being approached to join the firm as the CEO. Steven not only brought in the business acumen of general management to the company which was missing all this while (educational background in business studies) but also got the entrepreneurial experience that he acquired by working on different start-ups during his time in LIOF. The company started taking more bold decisions like creating a clean room in their production facility for getting bigger clients and also started expanding their human capital (Goetstouwers, 2018). Today more than 40 people are employed at Admesy, the business looks stable at least for the next 5 years not only in terms of profitability but also with regard to customers and competition (Goetstouwers, 2018). The example of Admesy shows that while one of the attributes might be able to kick-start a venture, sustaining and scaling up can only be possible if all the experiences of technologists, managers and entrepreneurs are in synergy. While technologists tend to go deep in one aspect, managers and entrepreneurs are able to take decisions on much holistic basis (Gruber, Kim, & Brinckmann, 2015). A lot of bigger firms also show a similar trend of getting people on board eventually as the business scales up. Very few companies will survive for a longer period with just one kind of professionals. 2.5 Business Model Magretta et al. (2002) mentions that a good business model is just like a good story that is understandable and can connect easily to the targets. In case of Admesy, the revenue model which is a part of the business model (Bodewes, 2018) is a very simple story to understand (Magretta, 2002). They sell devices, and that’s it (Goetstouwers, 2018). Their source of making money is just from selling products off the shelf. Though as per Steven they could have made more money if they could have charged their customer on per piece/calibration basis but since their clientele is majorly factories, getting data out their premises is next to impossible because of the protection and privacy of such facilities. Once a device is sold, Admesy has nothing to do with it. Therefore, due to its type of customers, Admesy was forced to adapt a very simple revenue model. But the story gets complicated at the communication and knowledge sharing with their customers. Complicated for a layman but necessary for the business more of a strength for them altogether. To understand the needs of the customer, individuals from Admesy interacts with various stakeholders at the client’s side, like the production team, planning team, engineering department, and so on. This is a long and tedious process but key to deliver the right product. Not only the customers get what they ask for but even Admesy adds a lot to its knowledge portfolio through this activity that helps them for 10 developing future products. Admesy does charge the customers for such activities, sampling and postsale services but that makes a very small share in their total sales. Also, rather than working on width they rely on depth which means, less customers with huge sales orders rather than more customers with fewer orders. We students saw this as a possible threat for the business but as per Steven firstly, the nature and trajectory of the industry doesn’t pose any immediate threats to this business model and second, they are ready to diversify at any point if the need arises. Also, due to the industry trends, customer demands and lifetime of their products, they launch 4 new products every year, 3 being upgrades or improvements from the existing products and 1 being completely new, and this forms a major part of the business model as well (Goetstouwers, 2018). Therefore, in case of Admesy, it can be observed that the design theme of their business model is mostly ‘lock-in centered’, where every activity right from product development to revenue generation is mostly dependent and revolves around their customers (Amit & Zott, 2015). Also, let us try and identify the four antecedents of Ademesy’s business model (Amit & Zott, 2015). 2.5.1 Antecedents of the Business Model The ‘goal’ was to make a product that can automate the measurement and checking of display calibrations and reduce the amount of time and money being invested on redundant activities, the value saved was the value created (Amit & Zott, 2015). It is very likely that their ‘goals’ and the idea of ‘value generation’ has modified over the decade as the company has grown and the business has diversified into other industries and different categories of products (Goetstouwers, 2018). ‘Template’ in this case was the alertness (Cheah, 1990) to their workplace, background and of course the problem that they identified. Their work in Phillips and their engineering backgrounds helped them ‘connect the dots’ of the display manufacturing industry and the use of sensors to address that. Basically to start with, they just ‘borrowed’ ideas from different spheres and put them under one concept to develop an innovative product (Amit & Zott, 2015). Steven is the biggest example of Admesy’s ‘stakeholder activity’ and how it shaped their business model over time (Amit & Zott, 2015). From being an investor and advisor to becoming the CEO and entrepreneur for Admesy clearly shows the growth path the company wanted to take. With his experience in business, negotiation and management, Admesy took a more collaborative stance to work with its big-shot customers like Samsung (Amit & Zott, 2015). The level of interaction and collaboration between Admesy and their customers can be understood by the fact that, the customers keep Admesy updated about their future developments and product road maps 1-2 years before the launch and Admesy keeps their customers updated about their R&D and ideas for new products every 6 months (Goetstouwers, 2018). In Steven’s words “no one ever imagined that we, being a relatively smaller company would be sitting across the same table as the market leaders of the electronic industry and be discussing deals” (Goetstouwers, 2018). Some of the ‘environmental constraints’ (Amit & Zott, 2015) for Admesy are (1) the challenges the founders faced at the start of the idea that instigated them to start the company (2) when the company 11 started landing bigger clients, their business model was not ready to cope up with it (3) sustaining the company when the market is slow, competition is strong and clients are limited (Goetstouwers, 2018). 2.6 Business Plan As per Steven, money was never the motivation behind him being an entrepreneur and he believes that is true for many of the entrepreneurs. It is often for the rush of doing things that no one tried doing, for creating something that could sustain for a long time or may be just to prove everyone wrong, people get into entrepreneurship. Personal goals take precedence over professional ones for individuals wanting to be entrepreneurs (Bhide, 1996) and they need to be specific. These goals, the road map and the strategy for growth and sustainability is what makes a business plan (Bodewes, 2018). Though within the lectures a lot of debate took place regarding the importance of a business plan, as per Steven business plans are very crucial to stick to the ground. His preference can also be attributed to his background as an investor where all his investment decisions were mostly based on ‘business plans’. Just like the market this plan also needs to be dynamic and needs to evolve with the business. Therefore, Admesy reviews and updates its business plan every year (Goetstouwers, 2018). 2.6.1 Strategy The fact that Admesy is one of the few companies that make colorimeters for the manufacturing industry and still don’t have any major patent filing astonished us regarding their strategy. How are they secured towards threats and competition? How sustainable the business is? But the amount of effort the company has put in developing products, gathering talent, making robust systems of manufacturing and distribution and building relationship with partners and customers is something that does not require patents (Bhide, 1996). Anyone can buy technology and secure funding but things like motivation, confidence, resilience, engagement and optimism can only be acquired with time (Radjou, Prabhu, & Ahuja, 2012). An example of a failed strategy is when Playboy at the peak of its business at the start of 1980s decided to get into other industries like books, records and resorts. Being in the magazine and entertainment club industry, they misjudged their capabilities and invested in those businesses just because they had the extra cash. Their lack of prior knowledge and competence into those sectors soon resulted in the company bleeding out a lot of money in failed operations and resources (Lopez, 2017). 2.6.2 Sustainability Sustainability might give an idea about how long an entrepreneur wants the venture to last and it might differ from person to person, but even entrepreneurs who would want to sell-out their businesses after a point, need to think about sustainability (Bhide, 1996), since only then people would want to invest in a business. Strategy for product development, market identification and segmentation, customer relationships and the most important, infrastructure and human resource should be focused for building a sustainable venture (Bhide, 1996). After the entry of Steven in the business, Admesy has not only invested in infrastructural improvements like building a ‘clean room’ but has also expanded its human resource to a much bigger size compared to the start of the venture (Goetstouwers, 2018). 12 But even after the above mentioned arguments, it might be realized that Admesy could have gone forward without a formal business plan since their idea was simple enough to understand by anyone. Two important reasons for Admesy to formulate a business plan were: (1) to convince the investors about the potential of their idea (2) to raise capital from banks and venture capitalists [further explained in mobilizing resources section]. Often companies need a business plan to compensate the lack of credibility (Bodewes, 2018) as a start-up or to legitimize their intents regarding the venture (Karlsson & Honig, 2007). Also, it is observed that business plans tend to change considerably after a period of time from the start of a venture and entrepreneurs lose interest in sticking to them. Many times, business plans end up just being a symbolic activity for a select few within the company (Karlsson & Honig, 2007). But at the same time, to stay grounded as mentioned by Steven and to keep evolving with the goals, strategies and sustainability in view, a business plan is important. There are many factors at play while discussing about the relevance of a business plan. How successful a business plan might be also depends on cultural contexts like uncertainty avoidance (Brinckmann, Grichnik, & Kapsa, 2008). Higher levels of uncertainty avoidance lower the benefits of a business plan. And since, The Netherlands scores comparably low compared to some its neighbors like France, Germany, Belgium and Italy (source: https://www.hofstede-insights.com), it is no surprise that Admesy believes and benefits from a business plan. I personally believe that the importance of a business plan is very contextual for a business or start-up since, the nature of the product, industry, cultural context, growth trajectory, government policies, rules and regulations, price segments, economy, society etc. all play a role in affecting the business plan (Brinckmann, Grichnik, & Kapsa, 2008). 2.7 Mobilizing resources Due to the nature of Admesy’s product, bootstrapping was never an option for them (Goetstouwers, 2018). And it is just not them; the ThreeFive Photonics case gave us a good understanding about the costs and capital involved in a photonics venture (Bodewes, 2018). Ryan Smith et al. (2016) reasons that bootstrapping can get an entrepreneur’s attitude right to achieve success, but I think it is not that simple. Yes, when one’s own money is invested, the pressure might be more to get it back (Smith, 2016) but it could be the other way round as well. Other people’s money might create much more pressure on a person than his/her own money because people tend to get soft on their own self. Information asymmetry between small businesses, banks, investors is another challenge that happens in the search of funding (Winborg & Landstrom, 2000) and ironically, small businesses bear higher costs in trying to look for funding sources compared to large businesses and the same applies for the financiers who look for legitimate businesses to invest upon, it is much costlier sifting through smaller businesses compared to larger businesses (Winborg & Landstrom, 2000). This irony might push smaller businesses to conformity (Zimmerman & Zeitz, 2002) like making business a plan (that involves cost) or seeking consultation (again a cost) about which I would discuss more towards the end of this section. 13 In case of Admesy, the founder’s were engineers working in Philips, which might have given them some credibility, but the legitimacy required by them to approach a bank or VC (Zimmerman & Zeitz, 2002) to ask for an amount as big as 2 million Euros back in 2006 was provided them by LIOF through Steven. Given the societal norms and general practices, a bank is much more likely to judge the legitimacy by a more credible source, in case of Admesy it was LIOF. An important point to be noted is that, that amount was not invested in one go, and was divided in a series of payments [250,000 Euros at once] (Goetstouwers, 2018). And, this way of securing funds could be referred as delayed financial bootstrapping (Winborg & Landstrom, 2000), where a long term financial commitment is not taken at a go. This also gives the banks and investors shorter periods to evaluate the progress of the venture. At the same time if we try to imagine a situation where LIOF or Steven would not have been in the picture or the founders didn’t come from a credible engineering background like Philips, it would have been very hard for the entrepreneurs to appear legitimate with just a great idea. The situation is indeed paradoxical for start-up ventures missing all the above mentioned elements to ask for legitimacy without showing legitimacy first (Zimmerman & Zeitz, 2002). But at the same time, challenges like these give birth to creativity and entrepreneurs tend to find creative ways to get things started. It could be modification of the idea or product as per the requirements of the sources of legitimacy they are after, or changing their sources of legitimacy or funding and opting for bootstrapping (Smith, 2016) first and then after some time getting to a point where they are legitimate enough to attract banks or VCs. The relationship between bootstrapping and bank/VC funding can be the same as bank/VC funding and public listing. Being a relatively small company but with a considerably faster growth, Admesy doesn’t see stock market as a good option at the moment (Goetstouwers, 2018). The amount of resources and energy that they would require to fund systems and procedures for reporting in order to be able to go public can better be utilized for fuelling growth. It would also tie their hands for experimentations that they are able to do currently (Goetstouwers, 2018) because in order to please the shareholders they would require cognitive legitimacy (Zimmerman & Zeitz, 2002). This is because investors and banks have specialists who are able to understand the complexities of the venture but public listed companies also need to woo the laymen who don’t care much about scientific jargons or business theories. I personally believe that conformity (Zimmerman & Zeitz, 2002) to the social and financial structures either pushes entrepreneurs to do something that can earn the trust of the financial institutions from which they seek funds or to change their funding plans altogether, the intent paves the way ultimately. 2.8 Scaling up Admesy went through an overload when they got the market leaders of the electronic and mobile phone industry as their customers (Zook, 2016). The founders got into disagreement regarding their strategy and one of them ended up quitting the company (Goetstouwers, 2018). To cope up with that overload, the company got Steven on board to steer itself towards the direction where it can handle the responsibilities that come along scaling up. And, from that point till today, Admesy did manage to scale up on many fronts. 14 As mentioned earlier, Admesy launches 4 new products every year and in a matter of last 1-2 years that have increased their workforce from 20 to 40 (Goetstouwers, 2018). Though hiring new talents, training and socializing them are no easy task for a company and it needs to be carefully planned (Bodewes, 2018). These two things are inter-related since the company wants to increase its managerial capacity in conjunction to its entrepreneurial motives (Barringer & Jones, 2004). The company might have gone under the “Penrose effect” in the mid of 2012 when it struggled with its strategy due to the lack of sufficient managerial capacity, given to the fact that all the three founders had an engineering and entrepreneurial background only (Barringer & Jones, 2004). The disagreement between the founders might not have been just about growth, but the other factors that growth might have affected like employee welfare or the independence of the company as whole (Gilbert, McDougall, & Audretsch, 2006). Admesy had a slow growth in the first 6 years of its existence almost without any actual profits, may be because the founders might perceived growth as risky (Bodewes, 2018). Steven’s experience in growing other firms and his prior experience in working with start-ups as an investor definitely helped Admesy achieve growth and their financial numbers are a proof. This shows that the characteristics of the entrepreneur indeed help the firms to grow (Gilbert, McDougall, & Audretsch, 2006). Their scale up strategy involves being one step ahead, for example they plan to move into a bigger office that would be 7 times larger than their current setup (Goetstouwers, 2018). As per Steven, they don’t need that right now, but the way they carry out their business would generate this need in the future, and they would already be ready with the infrastructure to support those needs. The same goes for human resource, their core belief is that grow the business they need people before and not after. 3. Conclusion One of the interesting facts about Admesy and its entrepreneurial aspect is the niche that they work for. Unlike many other entrepreneurs who target the mass to generate the big figures, Admesy goes in depth with fewer customers into the display industry but higher volumes of orders. They understand that their fundamental technology of light and color measuring can find application in many industries, but they strategically try to focus on just few of them and be experts of it. In the future if need be they can re-invent themselves through partnerships and collaboration to explore other territories. Talking about risks, as per Steven their biggest risk involves competition that might arise out the blue. Their current size, know-how and knowledge of the industry can only get them to a certain point and not beyond that. Another substantial risk to their business is their dependency on other businesses. Through this aspect of risk Steven even solidifies the value of a business plan by mentioning a case where, “if a battery of a Samsung phone explodes, it has nothing to do with Admesy’s product, but the loss of sales for Samsung does affect their sales just like the domino effect. A business plan helps them tackle such unforeseen circumstances, which otherwise might be very difficult to address. It was absolutely a great experience interviewing Steven about Admesy, his views about entrepreneurship in general and how it defers from the general perspectives. It was also interesting that 15 Steven is not one of the founders of the company but still happens to know the in and out of Admesy from the start. 4. Exhibits 4.1 Group Picture In the picture - Parth Chauhan, Steven Goedstouwers, Sultana Haque and Devim Adiguzel December 4th 2018, Admesy Headquarters, Ittervoort, Netherlands 4.2 Business Card 16 References Alvarez, S. A., & Barney, J. B. (2007). Discovery and Creation: Alternative Theories of Entrepreneurial Action. Strategic Entrepreneurship Journal , 11-26. Amit, R., & Zott, C. (2015). Crafting Business Architechture: The Antecendents of Business Model Design. Startegic Entrepreneurship Journal , 331-350. Baron, R. A. (2006). Opportunity Recognition as Pattern Recognition. Academy of Mangament Perspectives , 104-119. Barringer, B. R., & Jones, F. F. (2004). Acheiving Rapid Growth: Revisiting The Managerial Capacity Problem. Journal of Developmental Entrepreneurship, Vol 9, No. 1 , 73-86. Berman, J. (2016). Meet Tech Companies Creating Opportunities in Africa. Harvard Business Review , 24. Bhide, A. (1996). The Questions Every Entrepreneur Must Answer. Harvard Business Reiew , 120-130. Bodewes, W. (2018, November 26). Entrepreneurship (MBA) Theme 1 - Understanding Entrepreneurship. Maastricht, Limburg, The Netherlands. Bodewes, W. (2018, November 26). Entrepreneurship (MBA) Theme 2 - Opportunity Discovery and Development. Maastricht, Limburg, The Netherlands. Bodewes, W. (2018, November 28). Entrepreneurship (MBA) Theme 3 - Sources of Opportunity. Maastricht, Limburg, The Netherlands. Bodewes, W. (2018, November 28). Entrepreneurship (MBA) Theme 4 - Opportunity Validation. Maastricht, Limburg, The Netherlands. Bodewes, W. (2018, November 28). Entrepreneurship (MBA) Theme 5 - Business Modelling. Maastricht, Limburg, The Netherlands. Bodewes, W. (2018, November 28). Entrepreneurship (MBA) Theme 6 - Business Planning. Maastricht, Limburg, The Netherlands. Bodewes, W. (2018, November 29). Entrepreneurship (MBA) Theme 7 - Mobilizing resources. Maastricht, Limburg, The Netherlands. Bodewes, W. (2018, November 29). Entrepreneurship (MBA) Theme 8 - Scaling Up. Maastricht, Limburg, The Netherlands. 17 Brinckmann, J., Grichnik, D., & Kapsa, D. (2008). Should entrepreneurs plan or just storm the castle? A meta-analysis on contextual factors impacting the business planning–performance relationship in small firms. Journal of Business Venturing , 24-40. Bruyat, C., & Julien, P.-A. (2000). Defining the Field of Research in Entrepreneurship. Defining the Field of Research in Entrepreneurship , 165-180. Chauhan, P. (2018, November 13). 40036157-MCD-MBA35. Maastricht, Limburg, The Netherlands. Cheah, H. B. (1990). Schumpeterian and Austrian Entrepreurship: Unity within Duality. Journal of Business Venturing , 341-347. Gilbert, B. A., McDougall, P. P., & Audretsch, D. B. (2006). New Venture Growth: A Review and Extension. Journal of Management, Vol. 32 No. 6 , 926-950. Goetstouwers, S. (2018, December 4). Entrepreneurial Journey - Admesy. (P. Chauhan, D. Adiguzel, & S. Haque, Interviewers) Gruber, M., Kim, S. M., & Brinckmann, J. (2015). What is an Attractive Business Opportunity? An Empirical Study of Opportunity Evaluation Decisions by Technologists, Manageers and Entrepreneurs. Strategic Entrepreneurship Journal , 205-225. Isenberg, D. J. (2008). The Global Entrepreneur. Best Practice , 107-111. Karlsson, T., & Honig, B. (2007). Judging a Business by its cover: An institutional perspective on new ventures and the business plan. Science Direct: Journal of Business Venturing , 27-45. Kuechle, G., Reshef, B. B., & Carr, S. D. (2016). Prediction and Control Based Strategies in Entrepreneurship: The Role of Information. Strategic Entrepreneurial Journal , 43-64. Lopez, R. (Director). (2017). American Playboy: The Hugh Hefner Story [Motion Picture]. Magretta, J. (2002). Why Business Models Matter. Harvard Business Review , 86-92. Mueller, R. M., & Thoring, K. (2012). Design Thinking vs. Lean Startup: A comparison of two User-driven Innovation Strategies. Leading Innovation Through Design , 152-161. Premuzic, T. C. (2012). How Bad Leadership Spurs Entrepreneurship. Harvard Busines Review , 1-4. Radjou, N., Prabhu, J., & Ahuja, S. (2012). Jugaad Innovation. Gurgaon: Penguin Random House India. Reyman, I. M., Andries, P., Berends, H., Mauer, R., Stephan, U., & Burg, V. E. (2015). Understanding Dynamics of Strategic Decision Making in Venture Creation: A Process Study of Effectuation and Causation. Strategic Entrepreneurship Journal , 351–379. Smith, R. (2016). Why Every Startup Should Bootstrap. Harvard Business Review , 2-4. 18 Winborg, J., & Landstrom, H. (2000). Financial Bootstrapping in Small Businesses: Examining Small Business Managers' Resource Acquisition Behaviours. Journal of Business Venturing , 235-254. Zimmerman, M. A., & Zeitz, G. J. (2002). Beyond Survival: Acheiving New Venture Growth by Building Legitimacy. Academy of Management Review , 414-431. Zook, C. (2016). Every Fast-Growing Company Has to Combat Overload. Harvard Business Review , 2-5.