Austrian economics recognizes change as a constant and provides guidance for adapting to it and managing it. Change is changing for business — it’s faster and more fundamental in the digital age. Austrian economics can help even more as a result of its practical and realist approach to adaptation and continuous adjustment.

Knowledge Capsule
Change is changing.
Change is a constant. You can think of the market in constant flux, as Mises did, You can think in terms of VUCA — volatility, uncertainty, complexity, and ambiguity. You can think of it in terms of complexity or of absolute uncertainty. However you tune your mind and your business processes, there are always going to be more things that can happen than you can predict or prepare for.
There are some

Market research is a tool for gathering data about customers and consumers that businesses hope will lead to insights about their behaviors and preferences that can be translated into innovation, better service and better business performance. As with any dynamic system, it has changed over time, and the effects of entropy have begun to show themselves in invalid techniques, invalid data, and invalid conclusions. And as with virtually all business systems, the coming of the digital age provides businesses with the opportunity to review, revise and improve exiting practice and existing thinking.

Knowledge Capsule
Traditional models of market research are losing validity.
The Economics For Business approach to market research leans to the qualitative, such

Peter Drucker famously identified the only two value-generating functions of the firm as innovation and marketing. We propose to differentiate brand building (or branding) from marketing, especially in this digital age. Brands are the vehicle for framing, establishing, nurturing and enhancing relationships with customers. In the digital age, marketing has become mechanized and mathematicised; it’s about numbers more than about human values and emotional bonding. Graceann Bennett is a branding expert who has devoted her career and her research agenda to furthering the science of brand building.

Knowledge Capsule
Brands are assets that drive customer value and business revenue, and they’re more valuable than ever in the digital age.
Our Economics For

It’s time to re-imagine how entrepreneurs bring their innovative value propositions to market at the appropriate scale to meet the important needs of millions of people. The new way of thinking is for entrepreneurs to focus all their energy on designing, refining and strengthening the value proposition, and then plugging in to a network of resources assembled by others so that customers enjoy the full realization of the value experience the entrepreneurial has designed. Jeff Grogg of JPG Resources joined Economics For Business to describe how this works in the CPG food and beverage industry.

Knowledge Capsule
Starting From A New Value Proposition.
The entrepreneurial journey — whether starting a new company or launching or improving a brand or launching

What is strategy, and is it useful for business? Business schools want you think it is the critical factor in competitive success or failure. They teach structured markets, divided up by market share, with boundaries and external and internal forces to be assessed and countered. “Where to play and how to win.” They see strategy through their lens of financialization and utilize fictitious economic calculations like discounted future cash flows and market capitalization. There’s very little Austrian flavor in their view — no acknowledgement of subjective value and the qualitative drivers of value, customer sovereignty, empathy, constantly changing customer preferences, no role for the entrepreneur in helping customers learn what they can want in an evolving world.

A great benefit of the internet age is the capacity to accumulate, accelerate, and intensify connections between entrepreneurs, knowledge sources, investors, mentors, collaborators, and service providers. Businesses with a valid value proposition who are in the launch and early expansion phases can interconnect a network of powerful and qualified resources to support their growth. A good way to do so is to utilize a platform (another product of the internet age) designed for the purpose. Tom Malengo established a platform called Brandjectory to serve just this purpose for consumer packaged goods (CPG) startups.

Key Takeaways and Actionable Insights.
Brandjectory’s value proposition is to solve the problem of how to build an investor-ready business.
The purpose

It’s often the case that lead users — the most sophisticated, committed, and energetic users — are an excellent source of innovation ideas. Those customers who are most engaged are thinking the most intensely and the most creatively about what they want from the usage experience. We came across a particularly instructive example: video game modders. Who are modders, what do they do, and what can we learn from them? Professor Gordon Miller has studied this important entrepreneurial phenomenon, and he joins Economics for Business to share his knowledge.

Key Takeaways and Actionable Insights.
Modding is user-generated value innovation.
Modding, from modifying, is the act of a changing a game, usually through computer programming, with software tools that are not

At the core of the entrepreneurial orientation that is the engine of vibrant, growing, value-creating, customer-first businesses, we find the principles of subjectivism and subjective value. Subjective value embraces not only the value the customer seeks, but also the value that entrepreneurs establish in their companies: capital value. Once businesses master these two principles in combination, they can open new horizons of innovation and growth.

Key Takeaways and Actionable Insights
A fundamental advantage of Economics For Business over traditional business schools is the understanding of subjective value.
It’s hard for conventional businesses, and for the traditional instruction in business school, to fully embrace all the insights of subjectivism and the

What drives customer behavior and customer choices? It’s the existential question for business; you’ve got to know the answer. But it’s a mystery, hard to unlock. The solution to this answer lies in what market researchers call insights, based on the Austrian deductive method that we summarized in episode #164 with Per Bylund (Mises.org/E4B_164). In episode #165, we talk to Darshan Mehta, a lifelong professional in the field, an advisor to global and local brands, an originator of insights technology, and a deep thinker in the field.

Key Takeaways and Actionable Insights
Insights mark the road to innovation and differentiation and give businesses a competitive advantage.
By definition, an insight is a deep understanding of the motivation of an individual: why

All value is subjective. But often, when an exchange is to be made, a numerical value is required. It’s a special kind of economic calculation, what Bharat Kanodia terms “a subjective opinion based on objective facts”.
Bharat has built a career on valuations, from 2-founder garage start-ups to the Eiffel Tower. He shares his knowledge, experience, and insights with the Economics For Business podcast.

Key Takeaways And Actionable Insights
Valuations start with a “what?” and a “why?”
What is the subject of the valuation? Is it a building but not the land it’s sitting on? Is it a patent? Is it a monetized patent or just an approved patent? Is it the assets of a business or is the going business? All these definitions and classifications of what’s being valued

Entrepreneurship is a method, and it’s also a mindset. Fabrice Testa has written a book that brilliantly integrates the two: he calls the integration “Super Entrepreneurship,” and his book title is therefore Super Entrepreneurship Decoded (Mises.org/E4B_139_Book). He has the appropriate credentials as a proven super-entrepreneur who has created and nurtured numerous great companies (and successfully sold a couple of them).
Fabrice knows the true meaning of the phrase, “The day before something is a breakthrough, it’s a crazy idea”.

Entrepreneurs are animated by their purpose. Super entrepreneurs embrace a massive transformative purpose.
The motivation for entrepreneurs is to help others — to solve problems for others, as we sometimes phrase it. Super

With the development of the Austrian Business Paradigm and the Austrian Business Model, and tools such as the “Value Learning Process,” businesses of all kinds can utilize the deep insights of Austrian economics to further enhance how they facilitate value for their customers.
John Boles — an avid listener of the Economics for Entrepreneurs Podcast — provides an example of how he applies these insights at his accounting firm. Here is a summary resource and a step-by-step outline: Mises.org/E4E_97_PDF.

1) Improved customer understanding.
The Austrian business paradigm places the customer in first position. This contrasts with traditional business thinking that puts the firm or the product or service in first position and searches for ways (“strategies”) to sell

“Small business” is just a government classification. Entrepreneurial businesses serving well-defined communities via creative specialization exhibit enormous economic productivity, energy and dynamism.
Such businesses can not be defined quantitatively as small, medium or large. They’re defined by their qualitative impact on their customers’ lives.

Entrepreneurial businesses care differently, and care more.
Big businesses must pay attention to size and scale, to their huge revenue and profit streams, to their many, many shareholders, to journalists and bureaucrats and financial analysts. They are, typically, managing to maintain progress or status on a well-established pathway, and have limited time and resources to devote to customer care.
The triple option of

Key Takeaways and Actionable Insights
Austrian economics sees an economy in motion, perpetually renewing itself. Economic agents (firms, customers, investors) constantly change their actions and strategies in response to outcome they mutually create. This further changes the outcome, which requires them to adjust afresh.
Entrepreneurs live in a world where their beliefs and strategies are constantly being “tested” for survival within an outcome these beliefs and strategies create. It’s complex.

One of the strategies required in this dynamic system is innovation: the enabling of new value propositions to customers, sustained by new resource combinations, new technologies, new go-to-market capabilities, new channels and new delivery mechanisms.
Innovation has

Key Takeaways and Actionable Insights
An understanding of the Austrian definition of capital is tremendously useful to all business owners and managers.
What is capital? Austrian economics has a precise and distinctive definition — unlike business schools and most business publications, books, and columnists. Among those entities, the term capital tends to be used very imprecisely. You might see sentences like, “Entrepreneurs must ensure they have sufficient capital to get their new product to market”, or “to get to break-even”. Such usages imply that capital is a cash reserve to be “burned off” in the process of launching and scaling a business.

Recently, it has become fashionable to coin terms such as human capital, or brand capital, or relationship capital,

Key Takeaways
The entrepreneurial instinct can be sparked in K-12 and around the family dinner table.
An entrepreneurial culture is highly beneficial to society at the global, national, and local levels. We should examine how well we nurture the entrepreneurial instinct in K-12 schooling and in the discussions we have with our kids at home.
Clay Miller got a Commodore 64 (you can look it up!) when he was 11 years old, and his interest in computing, software and writing code started there. He was a programmer at 11 years old (something that is more common today than it was when Clay was young) and developed a taste for programming and an aptitude and some skills. He learned how to jump over hurdles of software-writing complexity at a young age.

A mentor can

Key Takeaways and Actionable Insights
Innovation is one of the keys to business success.
The world is changing at such a pace, and your customers’ preferences are changing so fast, that your business has to change at the same speed, or even faster. How to keep up is a part of the entrepreneurial challenge.

Mark Packard has a big insight about how entrepreneurs manage innovation.
Producers don’t innovate. Customers do. That may sound a little odd, but Mark’s Value Learning Process makes it clear. Customers are always looking for new value. They’re always dissatisfied, seeking to make things better for themselves. They know what’s wrong or disappointing or less than perfect with their current experience. And they’re always looking for new solutions, better ways