Demystifying “Value” through an Empirical Examination of Entrepreneurial Ventures

It is commonly understood that entrepreneurs need to create value for different stakeholders in order for their ventures to be successful in the long run. However, if we were to ask what is this “value”?, there would hardly be a satisfactory answer. For some, value is profits for shareholders, for some others – it is an intangible benefit that cannot be measured, and is only in the eye of the beholder. This paper attempts to demystify “value” by empirically examining value creation/destruction in 11 entrepreneurial ventures. It unearths five different dimensions of value that include both financial and non-financial impacts and argues that value creation or destruction should be described and measured as stakeholder capability improvements. The paper is positioned as an extension of a debate between shareholder wealth and stakeholder value proponents regarding purpose of the corporation.

Journal or Publication:
Academy of Management Proceedings
Ishrat Ali
Saras Sarasvathy
Year Published
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