Managerial or entrepreneurial capital? Untangling constraints of innovative entrepreneurs

Last registered on December 28, 2021


Trial Information

General Information

Managerial or entrepreneurial capital? Untangling constraints of innovative entrepreneurs
Initial registration date
December 27, 2021

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
December 28, 2021, 2:04 PM EST

First published corresponds to when the trial was first made public on the Registry after being reviewed.



Primary Investigator

Pontificia Universidad Católica de Chile

Other Primary Investigator(s)

PI Affiliation
London School of Economics
PI Affiliation
World Bank

Additional Trial Information

In development
Start date
End date
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Entrepreneurial support programs have been implemented over the last decades to foster innovative entrepreneurs in developed and developing countries. Usually, these programs are carried by local business accelerators that provides cash and support services in terms of training, mentorship, access to contacts, among others. While there is some evidence that this type of interventions can foster innovative entrepreneurs , it is still unknown what are the mechanisms that drive the ventures’ growth.

Gonzalez-Uribe and Reyes (2020) explores whether providing support services (training, mentorships, etc.) and no cash have an impact on ventures’ success. This paper finds that innovative entrepreneurs face different constraints besides financial ones. Entrepreneurs that received non-monetary support increased their annual sales by 66% during the three following years after the intervention. However, it is still not clear how those interventions affect the entrepreneurs. Is it because it provides them with managerial capital (a la Bloom and Van Reenen, 2010; Bruhn, Karlan, and Schoar, 2010) so they can run their businesses more efficiently? Or is it because it provides them with entrepreneurial capital (a la Gonzalez-Uribe and Leatherbee, 2018) so they can discover and capture valuable opportunities more effectively?

As well-known practitioners such as Steve Blank have declared, “new ventures are not small versions of large companies.” Implicit in this statement is the idea that the knowledge required to manage a large company is different to the knowledge required to build a new venture. In fact, it implicitly highlights the hypothesis that applying the knowledge that is effective for managing a large company to a new venture can, in fact, be detrimental. Understanding the validity of this hypotheses is paramount for all initiatives that aim at fostering the creation and development of new ventures. If providing entrepreneurs managerial capital is as –or more– effective than providing them with entrepreneurial capital, then many programs that are currently doing so should stick to the status quo. However, if providing managerial capital to entrepreneurs is detrimental and, in contrast, providing them with entrepreneurial capital improves value creation and socioeconomic development, then many entrepreneurship-promotion initiatives may, in fact, require an urgent pivot in their provision of this type of capital.

The answer to this question will have large implications on how to run entrepreneurship support programs. In order to disentangle the effects of managerial versus entrepreneurial capital, we will provide equivalent groups of entrepreneurs unique treatments which aim to endow them with one or the other type of capital. Subsequently, we will compare how each group fares in terms of performance, growth and job creation.
External Link(s)

Registration Citation

Gonzalez-Uribe, Juanita, Michael Leatherbee and Santiago Reyes. 2021. "Managerial or entrepreneurial capital? Untangling constraints of innovative entrepreneurs." AEA RCT Registry. December 28.
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Experimental Details


A managerial capital intervention will focus in how to run the current company as efficiently as possible, while an entrepreneurial capital intervention will focus on exploring, validating and capturing market needs and business opportunities. On one hand, if entrepreneurs lack managerial capital, the intervention should help entrepreneurs to implement organizational changes such as the establishment of concrete routines, the creation of specific incentives for employees, or improving inventory management. In contrast, an intervention based on entrepreneurial capital should help founders discover and capture higher value opportunities for their products and services, much like the lean startup method induces founders to come up with new business ideas and converge faster on the viability of their ideas (Leatherbee & Katila, 2020). This can be done by providing entrepreneurs with mentors who have an entrepreneurial mindset (e.g., Sarasvathy, 2001; Busenitz and Barney, 1997) and consulting services oriented towards the exploratory stages (as opposed to the exploitative stages) of business creation.
Intervention Start Date
Intervention End Date

Primary Outcomes

Primary Outcomes (end points)
Entrepreneurship sales, growth, profits and jobs
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
The program will be divided into two stages. It is expected to have at least 154 beneficiary companies, these companies will be randomly divided between the two treatment arms.

1. In the first stage, each startup will receive a basic training program (same for the two treatment arms), weekly follow-ups (different focus depending on treatment arm) and 3 hours of support services (different focus depending on treatment arm). The first stage lasts 5 months.
2. After the first stage is completed, a demo day will be held in front of an evaluation panel that will include high-level executives, investors, and ecosystem leaders, among others.
The highest scoring 77 entrepreneurs of each treatment arm will be selected to go to the second phase of the program, for a total of 154 beneficiaries. This second stage will provide the entrepreneurs with 5 consultancy sessions. The focus of the session and who provides the session will be based on the treatment arm of the entrepreneur. The second stage will last 6 months.

Note: if at the time of program implementation there is a larger budget for more beneficiaries, the same rule of dividing the beneficiaries equally between the two treatment arms would apply.
Experimental Design Details
Randomization Method
randomization done in office by a computer
Randomization Unit
Unit of randomization: firm
Was the treatment clustered?

Experiment Characteristics

Sample size: planned number of clusters
6 regions of Colombia
Sample size: planned number of observations
At least 154 firms in total
Sample size (or number of clusters) by treatment arms
There will be at least 77 firms for each treatment arm, i.e. 154 firms in total. This will depend on the budget allocation obtained by the project (the sample could be increased).
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
The minimum detectable effect is $21M COP (with a power of 0.8).

Institutional Review Boards (IRBs)

IRB Name
The london school of economics and political science
IRB Approval Date
IRB Approval Number


Post Trial Information

Study Withdrawal

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Is the intervention completed?
Data Collection Complete
Data Publication

Data Publication

Is public data available?

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Reports & Other Materials