The Entrepreneurial Manager, Module 3: Operating the Business Model

Stig  Leschly; Mark  Roberge; Christopher T. Stanton

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Module Note | March 2019

The Entrepreneurial Manager, Module 3: Operating the Business Model

by Stig Leschly, Mark Roberge and Christopher T. Stanton

Language: English

Format: Print

13 pages

Citation:

Leschly, Stig, Mark Roberge, and Christopher T. Stanton. "The Entrepreneurial Manager, Module 3: Operating the Business Model." Harvard Business School Module Note 819-109, March 2019.

About the Authors

Stig Leschly

Senior Lecturer of Business Administration

Entrepreneurial Management

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View Publications »

Mark N. Roberge

Senior Lecturer of Business Administration

Entrepreneurial Management

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View Publications »

Christopher T. Stanton

Marvin Bower Associate Professor

Entrepreneurial Management

View Profile »
View Publications »

More from these Authors

Working Paper | HBS Working Paper Series | 2020

The Evolution of CEO Compensation in Venture Capital Backed Startups

Michael Ewens, Ramana Nanda and Christopher Stanton

We use individual-level data to shed light on the evolution of founder-CEO compensation in venture capital-backed startups. We document that having a tangible, marketable product is a fundamental milestone in CEOs’ compensation contracts, marking the point at which liquid cash compensation begins to increase significantly – well before a liquidity event. “Product market fit” also coincides with key human capital in the startup becoming more replaceable, marking an apparent transition in the firm's lifecycle from ‘differentiation’ to ‘standardization’. Although substantial increases in cash compensation for founder-CEOs in response to milestones improves the certainty equivalent of attempting entrepreneurship relative to flat pay, low cash compensation in the very early years can still deter entrepreneurship for potential entrants. We characterize the types of individuals most likely to be impacted by this constraint and hence those whose ideas are unlikely to be commercialized through VC-backed entrepreneurship.

Keywords: entrepreneurship; venture capital; Executive Compensation;

Citation:
Ewens, Michael, Ramana Nanda, and Christopher Stanton. "The Evolution of CEO Compensation in Venture Capital Backed Startups." Harvard Business School Working Paper, No. 20-119, May 2020. View Details

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Working Paper | HBS Working Paper Series | 2020

The Impact of COVID-19 on Small Business Outcomes and Expectations

Alexander Bartik, Marianne Bertrand, Zoë B. Cullen, Edward L. Glaeser, Michael Luca and Christopher Stanton

To explore the impact of COVID on small businesses, we conducted a survey of more than 5,800 small businesses between March 28 and April 4, 2020. Several themes emerged. First, mass layoffs and closures had already occurred – just a few weeks into the crisis. Second, the risk of closure was negatively associated with the expected length of the crisis. Moreover, businesses had widely varying beliefs about the likely duration of COVID-related disruptions. Third, many small businesses are financially fragile: the median business with more than $10,000 in monthly expenses had only about two weeks of cash on hand at the time of the survey. Fourth, the majority of businesses planned to seek funding through the CARES act. However, many anticipated problems with accessing the program, such as bureaucratic hassles and difficulties establishing eligibility. Using experimental variation, we also assess take-up rates and business resilience effects for loans relative to grants-based programs.

Keywords: COVID-19; stimulus; Health Pandemics; Small Business; Surveys; Insolvency and Bankruptcy;

Citation:
Bartik, Alexander, Marianne Bertrand, Zoë B. Cullen, Edward L. Glaeser, Michael Luca, and Christopher Stanton. "The Impact of COVID-19 on Small Business Outcomes and Expectations." Harvard Business School Working Paper, No. 20-102, April 2020. (Revised May 2020.) View Details

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Case | HBS Case Collection | February 2020

Drift: The First Sales Hire

Mark Roberge

Citation:
Roberge, Mark. "Drift: The First Sales Hire." Harvard Business School Case 820-103, February 2020. View Details

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The Entrepreneurial Manager, Module 3: Operating the Business Model

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About the Authors

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