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Chapter 10. Managing Risk and Uncertaint... > How Do Entrepreneurs Convince Stakeh...

How Do Entrepreneurs Convince Stakeholders to Bear Risk?

The previous discussion raises the question of how you can convince stakeholders to bear risk for you, given that getting others to bear risks is sometimes a valuable strategy for entrepreneurs. The answer is a function of several things, one of which is sharing rewards fairly. People bear risk because they get some sort of reward from it. Therefore, successful entrepreneurs share equity with people who bear some of their risk. Unsuccessful technology entrepreneurs want something for nothing. They do want to bear risk, but they refuse to share equity with those who would bear risks for them.[12]

Stop! Don’t Do It!

  1. Don’t use standard net present value calculations to make decisions about new technology ventures.

  2. Don’t forget to investigate different scenarios when making decisions about your new venture.



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