Introduction to Australian Study of Entrepreneurship Emergence (CAUSEE)

This study utilizes the Comprehensive Australian Study of Entrepreneurial Emergence (CAUSEE) to examine the entrepreneurial process of nascent entrepreneurs in internet-based ventures (IBVs) compared to other start-ups, here called brick & mortar ventures (BMVs). Internet-based firms are a well-known road of pursuable enterprise. While the start-up process for ventures in general has received considerable research attention there is a lack of information on the specific entrepreneurial process of IBVs. Possibly, the entrepreneurial process of internet-based start-ups is substantially different from those of brick & mortar start-ups. Current literature does not suggest one universal model of the entrepreneurial process (Carter et al., 1996; Davidsson, 2005). However, the entrepreneurial process has been accepted to contain at least two main subroutines; the ''discovery'' process and the ''exploitation'' process (Venkataraman, 1997; Shane & Venkataraman, 2000). The discovery process deals with the identification and conceptual development of an idea. The exploitation process is the tangible actions it takes to realize the idea, also known as 'gestation activities' (Gartner, Carter & Reynolds, 2004). These two processes are the summit of current research in the entrepreneurial process. There is no understanding of the time-specific gestation activities undertaken by internet-based firms and there runs a risk of unsuitable models being applied to this segment By, e.g., support agencies and educators. It is the purpose of this study to distinguish what entrepreneurial process IBVs follow and how this process may be significantly different from that of BMVs in sequence, duration and concentration. Methodology/Key Propositions For this study we will compare early findings from data collected through the CAUSEE. CAUSEE is a longitudinal study whose primary objective is to describe how new venture come into existence. Data was collected from a representative sample of some 25,000 households in Australia using random digit dialing (RDD) telephone survey interviews. Included in the study are the approximately 600 cases where the respondent is currently involved in a business start-up and willing to participate in the study. The unit of the analysis is the emerging venture, with the respondent acting as its spokesperson. The study methodology allows researchers to identify ventures in early stages of creation and to longitudinally follow their progression through data collection periods over time. A control group was also created using respondents that did not fit either criteria. The survey asked in-depth questions regarding their process in forming their company. The results of this survey will be used to provide an accurate measure of the sequence, duration and concentration of gestation activities within the entrepreneurial process. The results of respondents who expected more than 50% and above of their total revenue to be derived from the internet were classified as 'Internet-based'. Respondents with less than 50% of revenue (often 0%) expected to derive from the internet were classified as 'Brick & Mortar'. Results and Implications This research is exploratory and the results will provide insights in to the entrepreneurial process of internet-based firms. Variances between venture types in entrepreneurial processes will provide in-depth understanding of the unique requirements of each type of venture. Furthermore, a better understanding of internet-based start-up's gestation activities would benefit future discovery and exploitation models. On a practical note, for start-ups looking to emerge in the online industry our results will have implications on the sequence, duration and concentration of processes to pursue.