What is Entrepreneurial Learning?

In the previous section, I concluded that an entrepreneur is the role a person fills to create and manage a business to generate value for a customer. This implies that entrepreneurial learning is the learning that occurs while filling the entrepreneur's role. Since this thesis is studying and designing around the learning mentors provide for entrepreneurs, a definition needs to be developed that serves the purpose of guiding this thesis around the learning mentors provide for entrepreneurs. I will begin with an overview of various definitions of entrepreneurial learning, I'll then take what can be used from them, and finally, I will end with a discussion on why entrepreneurial learning matters for mentors.

In “Entrepreneurial Learning: a narrative-based conceptual model,” David Rae identifies three major areas that play a factor in the entrepreneur's learning: personal and social emergence, contextual learning, and negotiated enterprise. Personal and social emergence is the creation of the individual's self-perception as an entrepreneur. Essentially, believing that one's person can turn an idea into reality. Contextual learning is the use of one's knowledge and experience within an industry or community to recognize opportunities that ventures can be formed around. Negotiated enterprise is the process of engaging with other people to exchange labor, ideas, learned strategies, or capital (2).

Peter Erdelyi argues that entrepreneurial learning has two branches: one that involves personal learning and another that involves collective learning. Personal learning is focuses on the individual and her experiences, and is the process of “opportunity recognition” and constitutes the “cognitive mechanisms for identifying entrepreneurial business opportunities and making decisions about them” (3). Collective learning arises from the interaction of individuals within a firm or within an ecosystem. Both modes of learning give rise to behaviors that encourages the entrepreneur to acquire and use resources available within her network (3)

Berglund, Hellstrom, and Sjolander propose a model of entrepreneurial learning as a forward oscillation between two modes: hypothesis testing and hermeneutic learning. Hypothesis testing is coming up with an hypothesis and then preparing an experiment that allows to test the validity and soundness of the hypothesis, thus leading to learning. Hermeneutic learning, in contrast to hypothesis testing, occurs experientially and is tacit to the actions the entrepreneur makes. The entrepreneurs and the collection of individuals that comprise a startup, then fluctuate between these two states as they accumulate incremental knowledge about the product they're building, the customer's they're building it for, the market they're operating in, etc (1). Even though Berglund et al propose this model of entrepreneurial learning as a way to explain how venture capitalists influence entrepreneurial behavior, I think taking this model can be used within the context of a mentoring relationship to make obvious the entrepreneur's learning behaviors.

These researchers all hit upon a dichotomy between the individual and the networks they're a part of. The relationships the entrepreneur has with those internal to the startup and those external to the startup seems to determine the behaviors she learns, the opportunities she can recognize, and the opportunities she can act upon. What I mean is that entrepreneurial activity is inherently social in nature – it's both limited and enabled by the network the entrepreneur is a part of. It's limited by the size of the network and those she can learn from, and enabled by the people she's in contact with because she can learn new business strategies from her fellow entrepreneurs. This means that for the context of this thesis, mentors with business experience existing in the entrepreneur's network enable the learning of new strategies, behaviors, and can increase the size of the entrepreneur's network via introductions to new contacts. Entrepreneurial learning, from a mentoring perspective, is a feedback process to develop new strategies the entrepreneur can execute upon to continue managing her business.

The next section will go into a discussion of the different ways a mentor enables entrepreneurial learning.

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Sources:

1. Berglund, Henrik, Tomas Hellstrom, Soren Sjolander. "Entrepreneurial Learning and the Role of Venture Capitalists." Venture Capital July 2007: Vol. 9, No. 3, 165 - 181.
2. Rae, David. "Entrepreneurial learning: a narrative-based conceptual model." Journal of Small Business and Enterprise Development 2005. Vol. 12 No. 3, 323 - 335.
3. Erdelyi, Peter. "The Matter of Entrepreneurial Learning: A Literature Review."