The corridor principle is which states that once an entrepreneur starts a firm and becomes immersed in an industry, “corridors” leading to new venture opportunities become more apparent to the entrepreneur than to someone looking in from the outside.
According to Corridor Principle, an entrepreneurial venture can find that it has vitally modified its focus from the primary idea of the venture as it has repeatedly adapted and responded to its market and the target to utilize profitability potential.
In the words of Babson College’s Robert Ronstadt, "The Corridor Principle states that the mere act of starting a venture enables entrepreneurs to see other venture opportunities they could neither see nor take advantage of until they had started their initial venture. “
During the 1980s, he performed a 12-year study on the subsequent careers of the school’s MBA program’s graduates in entrepreneurship. The graduates who developed multiple ventures and extended their entrepreneurial careers’ duration by using this principle were the most successful. The researchers summarized the difference between the successes and failures in their study by a single word and that is ” launch.” The successful ones were interested in launching themselves down the opportunity’s corridor without any thought of what could go wrong. Whereas those who failed had done nothing with their learning and were just waiting for things to be right before they start.
More from this Section
- Barrier to Entry
A barrier to entry is a condition that creates a disincentive way for a new firm to enter ...
- Area franchise agreement
Area franchise agreement is an agreement that allows a franchisee to own and operate a ...
- General partnership
A general partnership is a form of business organization where two or more people pool ...
- Triggering Event
Triggering event means the event that prompts an individual to become an entrepreneur. ...
Interference refers to an administrative proceeding overseen by judge, which takes place ...