Amsterdam Business School

CASES IN CREATIVE
ENTREPRENEURSHIP
Prof. Dr. Mr. Nachoem M. Wijnberg

2 ENTREPRENEURSHIP & RISK (& INNOVATION)

 CASE: BLUMHOUSE MOVIES

• Focus on niche genres, esp. horror

• Topics/stories that are relevant/newsworthy
• Many small projects, then see which to choose for
big marketing support (mostly paid by distributor)
• Cutting cost
• lean operation
• risk taking by other stakeholders who are willing to wait
• paying staff minima (or nothing) up front, with big rewards IF
movie is a hit
• ps dont be afraid of letting other people be arty, because
that can help cutting cost.

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• Spivack, April J., Alexander McKelvie, and J. Michael
Haynie. "Habitual entrepreneurs: Possible cases of
entrepreneurship addiction?." Journal of Business
Venturing 29.5 (2014): 651-667.
• Hayward, M.L.A.; Shepherd, D.A. & Griffin, D. (2006) A
Hubris Theory of Entrepreneurship Management Science,
52, 2, 160-172.
• Mol, J.M., Chiu, M.M. and Wijnberg, N.M. (2012) Love me
Tender: New Entry in Popular Music, Journal of
Organizational Change Management, 25, 1: 88 - 120.
• Ebbers, J.J. and Wijnberg, N.M. (2012) Nascent Ventures
Competing for Start-up capital: Matching Reputations
and Investors, Journal of Business Venturing, 27, 3, pp.
372-384.

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 STYLIZED FACTS OF THE LABOR
MARKETS IN THE ARTS
1. Oversupply of artists
2. Extremely variable career patterns
3. Extremely unequal distribution of success
4. Financial exploitation, especially of newcomers

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SKEWED DISTRIBUTION OF SUCCESS

• Earning “almost nothing” with art

• Superstars
• Adler
• Rosen

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 THE EXPLOITED CLASSES

• Because of oversupply
• Because of psychological income
• Because of uncertainty tolerance/preference
• Because of multiple simultaneous jobs
• Because formal training is an imperfect filtering
device

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BACKLOADING COMPENSATION

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 SPIVACK ET AL. 2014
ENTREPRENEURSHIP ADDICTION
• Entrepreneurs as addicts
• Entrepreneurs & artists
• Entrepreneurs as addicts & artists as addicts
• Addiction & selfdestruction (see previous week)

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 (HABITUAL) ENTREPRENEURS AS
ADDICTS
• Chemical addictions – behavioural addictions
• Addictions to gambling, to social media use, to risk-
taking, to entrepreneurship
• What are the rewards - and why does one have to
have them again and again – or the penalties of
withdrawal?

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 ENTREPRENEURS - ARTISTS

• Artists are like entrepreneurs?

• Entrepreneurs are like artists?
• Entrepreneurs in the creative industries are like
artists?
• Entrepreneurs and artists can suffer from similar
behavioural addictions?

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 HAYWARD ET AL 2006 A HUBRIS
THEORY OF ENTREPRENEURSHIP
• Hubris explains entrepreneurship in the face of bad
odds, however hubris can also be a cause of
failure.

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HUBRIS

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 WHERE DID IT GO WRONG?

• Overestimation of one’s own capabilities

• Underestimation of necessary resources

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 THE BENEFITS OF OVERCONFIDENCE

• To individuals: allowing for learning experiences

(esp. serial entrepreneurs)
• To industry/society: innovation & dynamism

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PS ENTREPRENEURS ARE LIKE ARTISTS
IN RESPECT TO RISK?
• Higher risk preference
• Longer time horizon
• Higher evaluation ambiguity tolerance

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MOL ET AL 2012 LOVE ME TENDER: NEW
ENTRY IN POPULAR MUSIC
• Success by new entrepreneurs strongly dependent
on resources that give them access to institutional
gatekeepers.

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 THE BLACK BOX

Pre-resources
resources performance

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YOUR MOTIVATION AS A RISK TO YOUR
EXTERNAL STAKEHOLDERS
• Strong intrinsic motivation
• Will make you go on
• Even when business looks - and is – hopeless, especially
when you are an artists (with psychological income and
wanting to make art for art’s sake)

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 EBBERS & WIJNBERG 2012 NASCENT VENTURES
COMPETING FOR START-UP CAPITAL: MATCHING
REPUTATIONS AND INVESTORS

• Nascent ventures do not yet have reputations but

their founders do, and their success in finding
financing will depend on how well these reputations
match the preferences of the investors

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TWO PHASES OF COMPETITION (AND TWO
PHASES OF THE SELECTION SYSTEM)

• Competing for resources

• Competing for customers

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 THREE SELECTION SYSTEMS

• Market
• Peer
• expert

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 THREE MAIN INVESTORS

• Distributors
• TV Broadcasters
• The Film Fund

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 THREE KINDS OF REPUTATION

• Box office = market

• Reviews = expert
• Awards ( ) = peer

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• Hypothesis 1a. The market reputation, compared to the
other types of reputation, of a founding team member
of an entrepreneurial venture, has the strongest effect
on obtaining investment capital if the investors are
market selectors.
• Hypothesis 1b. The expert reputation, compared to the
other types of reputation, of a founding team member
of an entrepreneurial venture, has the strongest effect
on obtaining investment capital if the investors are
expert selectors.
• Hypothesis 1c. The peer reputation, compared to the
other types of reputation, of a founding team member
of an entrepreneurial venture, has the strongest effect
on obtaining investment capital if the investors are peer
selectors.

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 OUTCOMES

• Market reputation of producer helpful to get

investments from distributors – h1 partly confirmed
• Expert reputation of directors helpful to get
investments from broadcasters – h2 partly
confirmed
• Peer reputation didnt do much to get investments
from the film fund – h3 rejected – why?

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 PS

• Ebbers & Wijnberg 2012 The effects of having more

than one good reputation on distributor investments
in the film industry

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