Causal opportunity creation and effectual opportunity exploitation:

Insights from ‘heavy metal’ entrepreneurship

Laura Laaksonen, Researcher Aalto University School of Economics IDBM Program, P. O. Box 21230, FI-00076 AALTO +358 503836199 [email protected]

Antti Ainamo, Professor Aalto University School of Economics

Helena Yli-Renko, Assistant Professor University of Southern California

Toni-Matti Karjalainen, Research Director Aalto University School of Economics

ABSTRACT

In this paper we studied entrepreneurial decision-making through the theoretical lenses of causation and effectuation. We found that entrepreneurs use different logic in the decisions regarding their core product in contrast to market related decisions. We took an ethnographic approach in this longitudinal case study and studied entrepreneurs’ decision-making regarding products and markets and compared them. We developed theory from ground-up and present propositions to be tested. We find that the entrepreneurs under study used causal logic in their decision-making in the product domain and effectual logic in the market domain. We propose that the entrepreneurs create entrepreneurial opportunities by accumulating human capital in the product domain using mainly a causal approach, and that they exploit these opportunities using mainly an effectual approach in the market domain, after becoming experts in their field. We find this to be true in contexts and fields where contextual instrumental expertise is of utmost importance, for example music or biotech and that our results can be generalized in fields with similar characteristics.

Keywords: Effectuation, Causation, Expertise, Opportunity creation, Opportunity exploitation,

Music industry

INTRODUCTION

Entrepreneurs create products and services with novelty value that fit the evolving needs of the users. On the one hand, entrepreneurs operate in a domain associated with their core product. On the other hand, they operate in a domain associated with market and with evolving user needs. In this paper, we study how entrepreneurs make decisions in these different knowledge domains and how the decision-making evolves over time.

Knowledge characterizing the first (product) domain differs from the knowledge that characterizes the second (market) domain. Knowledge about technical development is standardized and coherent, organized around technology, and restricted by dominant designs and product technologies. In contrast to knowledge about technical advances, changes in cultural interpretations of appropriateness and value are produced through complex social interactions.

Hence, knowledge about markets is less predictable and transient. The opportunity domain related to user and industry preferences is complex, socially constructed and time bound, thus highly unpredictable.

We study opportunity creation taking place in the product domain and opportunity exploitation in the market domain by utilizing the theory of effectuation. Effectuation, as conceptualized by

Sarasvathy (2001), is a theory about an alternative process of decision making in management literature, in comparison to the dominant one of causation. Where causation rests on logic of causation, effectuation rests on logic of control. Effectuation processes are posited as the fundamental decision units in explanations how economic artifacts such as firms, markets and economies come to be. Effectuation begins with a given set of causes consisting of mostly unalterable characteristics and circumstances of the decision maker, and the focus is on choosing among alternative (desirable) effects that can be produced with the given set of means, thereby eliminating the assumption of pre-existent goals. Both causation and effectuation are integral parts of human reasoning. They may even overlap and intertwine over different contexts of decisions and actions. In the literature on causation and effectuation, the latter is portrayed as a process of decision making that takes a set of means (e.g. traits, tastes, skills and networks) as given and focuses on selecting between possible effects of the process. According to Sarasvathy

(2001), the effectuator’s given set of means include who I am, what I know and whom I know. At individual level this includes tastes, traits and abilities, knowledge corridors and social networks.

At the firm level this means physical resources, human resources, and organizational resources.

And at the level of economy this includes demographics, technology regimes and sociopolitical institutions. New ventures following the logic of effectuation open up new markets and industries, plugging into and exploiting social and technological contingencies that are difficult to plan for or to anticipate. As such, this process differs from causation, or what Sarasvathy (2001) considers the dominant process of decision-making in management literature. Causation takes a particular effect as given and focuses on ‘how to achieve a preset goal’ by selecting between means to create the effect. Further, effectuators are more likely to dive into marketing and selling activities and alliances, without traditional market research, such as surveys. Effectuators are also more likely to rely on short term informal planning in financial decisions, abandoning formal long term planning. They are more likely to build strong participatory cultures, instead of hierarchies. And are more likely to fail often and to manage these failures more effectively so that in the long run they are more likely to build larger and more successful firms.

The recent research on effectuation has drawn a wide interest among researchers in the field of entrepreneurship (Baron, 2008; Chiles, Gupta, and Bluedord, 2008; Dew, 2009; Dew et al., 2009; Goel and Karri 2006; Harmeling, 2009; Read et al., 2009a, 2009b; Sarasvathy, 2004; Wiltbank et al., 2006; Fischer and Reuber, 2011), still only a few systematic empirical studies exist (e.g.

Wiltbank et al., 2009; Chandler et al. 2011). In their recent review of literature on effectuation,

Perry, Chandler and Markova (2011) developed a list of 29 articles where effectuation was the main topic. Out of these 29 articles, sixteen were conceptual, and 13 were empirical. The empirical studies included both field studies using primary (5) and secondary data (1) and experimental studies (7). Yet, none of the existing studies consider the context the venture operates in, in other words, the complexity of the product or the differences in decision-making regarding product and market domains and how that influences the use of effectual versus causal logic. Based on their review, Perry et al. (2011) suggest that effectuation research is still in its infancy.

Aligned with the nascent state of effectuation theory, we have taken an ethnographic approach

(Van Maanen, 1992). As the main anthropological methodology, ethnography has the advantage of offering some solutions to tackle the challenge of studying social and cultural process of entrepreneurship (Stewart, 1991). Yet it has been rarely applied in the recent decades of entrepreneurship research. Zahra and Wright (2011) make a call for more contextualized research in entrepreneurship where the role of the researcher is highly engaged, the scope of propositions is bounded and phenomenon is defined by context, i.e. meaning and boundaries often evolve as research progresses. Existing anthropological research in entrepreneurship demonstrates the widespread importance of, and problems in, the accumulation of knowledge and skills (Stewart,

1991). Still, very little is known about how the context influences entrepreneurial decision- making, identification and exploitation of opportunities, especially regarding high potential opportunities (Shane, 2012).

The primary contribution of this study is identifying different logics used in market and product domains. More specifically, we identify logic of causation, when decisions are made about product features and aspects and opportunities are created. Further, we identify logic of effectuation, when decisions are made in how to commercialize the product, in other words, how to exploit these opportunities. We find that decision-making differs between these two domains, and that causal and effectual decision-making logics are both applied.

The second contribution of our study is the understanding of how the context influences the identification and exploitation of opportunities (Shane, 2012). We study entrepreneurs who operate in a context where contextual, instrumental expertise is of utmost importance. Contextual expertise is built through extensive practice that is motivated by a larger instrumental objective and moderated by inherent enjoyment of the activity. (McPherson, 2005; Bloom, 1985)

The third contribution of our study is applying the effectuation framework in the context of creative and cultural industries. Entrepreneurship in creative and cultural industries has rarely been studied in academia. In creative industries, the product is highly intangible, difficult to measure in content or success and ultimately a result of an artist’s imagination.

In the next section we describe the methodology of this longitudinal ethnographic study. After that we present our findings, contributions to theory and the propositions arising from our findings. Concluding remarks, limitations and potential for future research are presented last.

METHODOLOGY

As the aim is to inductively describe and explain the decision-making regarding the product, decision-making regarding markets, we have taken a longitudinal approach and look throughout the history of the venture. Hence we have conducted participant observation, tracked historic secondary data and conducted in-depth interviews about the history and current venture processes to develop and test theory from ground up and focus on validity and accuracy rather than generalizability. (Miles and Huberman, 1994; Strauss and Corbin, 1998; Yin, 2003) Thus we are able to develop a foundation for theory-generation (Eisenhardt, 1989). We operationalize the causation- effectuation framework introduced by Sarasvathy (2001). Further, we utilize the constructs developed by Dew et al. (2008). The chosen research strategy fits the nascent state of effectuation theory (Perry et al 2011), as suggested by Edmonson and McManus (2007), including methods for data collection, types of data collected, analysis and theoretical contribution.

A qualitative approach is especially suitable for poorly understood phenomena (Marshall and

Rossmann, 1995). Further, it fits situations where contextualization, vivid description, dynamic structures of the organization’s members’ socially constructed world and the worldviews of people under study are important (Lee, 1999:43). The chosen approach answers calls for a substantive shift in the focus, content, and methods of entrepreneurship studies and the absence of ‘engaged scholarship’ as researchers do not sufficiently examine the behavior of real entrepreneurs (Zahra and Wright, 2011). An ethnographic case study with detailed description of the context also suites the purposes of an exploratory study aiming at theory building (Eisenhardt

1989; Yin, 2003).

We have adopted an ethnographic approach (Van Maanen, 1988; Atkinsson and Hammersley,

1994; Stewart, 1991) because of the advantages it provides for the study of social and cultural life. Hence, we were able to study decision-making in situ and understand how processes evolve over time (Perlow, 2002). We studied the entrepreneurs in their everyday context, using observation as primary means of data collection, that was flexible and unstructured and our focus was on a single group of entrepreneurs on a small scale, as recommended by Hammersley (1990).

We took a longitudinal approach, gathering information over time, between 2008-2011, and followed the venture’s progress in order to allow new insights to emerge. Entrepreneurial processes are dynamic and difficult to understand using cross-sectional techniques. (Johnstone,

2007) Thus we followed action as it unfolded over time. (Davidsson, 2003:55) We took a subjective approach to gain a better insight of strategic intentions and deepen the meanings that are not talked about or that are taken for granted by the group. (Smith et al., 1989) Other advantages of subjective approach include understanding the social complexities, uncovering deeper meanings and overcoming reluctance to report.

Research setting

Our focus in this paper is how and why Children of Bodom, a Finnish metal music group went through intertwined effectual and causal decision-making processes, from its founding in 1995 until 2011 or the time of writing this paper, resulting in unanticipated global success. We analyze a unique type of venture: the band, also known as the music group. Our perspective is one of the individual founders. Children of Bodom was chosen as the case because of its ‘rare or unique’ qualities that make it a logical candidate for ‘theoretical sampling’ (Eisenhardt, 1989; Yin, 2003).

The chosen venture is an excellent representation of international entrepreneurs who are considered experts in their field. What makes this case particularly unique is the fact that back when they started, their success could not have been predicted by any means. Even the entrepreneurs themselves were concerned about finding an audience for their music. But because they loved their music themselves, they kept going, despite multiple rejections in the beginning of their career. Today COB is a globally recognized heavy metal band, successful business venture for the founders and the main employer for not only themselves, but also many of their technicians and support staff. The band was incorporated in 2003. They are significant clients of their record labels, management companies and booking agencies. They have also partnered with instrument manufacturers and distributors and instructional video producers. By 2011 they had sold over one million records globally and they have 1,6 million fans in Facebook. Alexi Laiho’s, the lead guitarist’s, guitar-playing techniques have been recognized in the music media globally, leading to his consecration in Guitar World magazine as the most promising young guitar player in 2006 and as the best metal guitarist in 2009. COB has also been called ‘technically dazzling’ by the New York Times and ‘One of the most talented metal bands of our time’ by contemporary media conglomerate VICE. The band has three major sources of income: touring, record sales royalties and merchandise sales. There are also other sources of individual income for the members, such as royalties from signature model instruments and publishing royalties.

Data collection

The researcher was not in a working relationship with the venture, but knew the entrepreneurs and some of their stakeholders beforehand through personal contacts.

‘Without some true participation, the researcher may not have accorded the natives respect for their ways of life, and may not really access their crucial ‘lore.’ Further, the subtler forms of social and cultural knowledge are, in a sense, socially positioned, and for this reason alone the ethnographer must put himself or herself in the position of the native practitioners. This means putting aside notebooks and simply working, smelling, dancing (why not?) and so on.’ Smith (1991)

The bands in the heavy metal genre are a part of a tightly knit social circle of musicians, music industry representatives such as managers and record label personnel, booking agents, journalists and fans. Becoming a trusted member of the social circle was crucial in order to collect reliable data in this context and building trust with informants. As an example of this, when informants were approached without an introduction of a trusted member of the circle, there were no responses or the requests were politely turned down. These are challenges that researchers in popular music field have faced before (Power and Hallencreuz, 2007). Earning the trust and accessing the key informants meant spending time in this social setting, for a lengthy period of time. Also as exchange for favors, the researcher helped informants in random tasks such as driving an informant to computer service across the town and bringing informants luggage from overseas.

In the course of the study we used cyclical patterns of investigation to accommodate a flexible approach to data gathering (Spradley 1980:28). The data collection process consisted of three overlapping stages between 2008-2011 (36 months), as data accumulated until the final stage where data saturation was reached (Eisenhardt 1989).

Expert interviews In the first phase we interviewed participants in the music business on a very broad scope, with a broad set of interview questions to define what are the relevant aspects of succeeding as an artist in the global music markets. Most interviews were recorded and transcribed though a few interviews were conducted on ‘off the record’ –basis, in which case researchers relied on interview notes. During the first phase researchers also participated in music industry conventions both locally and internationally and collected notes and quotes from panel discussions, roundtable discussions and keynote speeches.

Participant observation The second phase of research consisted of participant observation and informal meetings with entrepreneurs in the selected venture, as well as their key stakeholders, while being an active member in the closed social circle between 2008-2011. In addition to these informal local participant observation, the researchers conducted participant observation around shows the band played in Finland, the US, Canada, Japan and Denmark. This allowed the researchers to interact with several stakeholders of the band, including the band’s management, record labels, crew, former band mates, publicists, fans and many others they have worked with over the years in Finland and abroad. The observation strategy was ‘observant participant’ where the researcher was an existing participant taking the role of an observer, with having the advantage of already fitting the group. Experiential data are considered essential data, because they not only give added theoretical sensitivity, but provide a wealth of provisional suggestions for making comparisons, finding variations and sampling widely on theoretical grounds. This helps the researcher to formulate a conceptually dense and carefully ordered theory. (Strauss,

1987)

The observation strategy was ‘observant participant’ where the researcher was an existing participant taking the role of an observer, with having the advantage of already fitting the group.

Experiential data are considered essential data, because they not only give added theoretical sensitivity, but provide a wealth of provisional suggestions for making comparisons, finding variations and sampling widely on theoretical grounds. This helps the researcher to formulate a conceptually dense and carefully ordered theory. (Strauss, 1987) As participant observation should never stand alone as a method, other methods were used (Brewer, 2000) Field notes (approximately 200 notebook pages) were complemented with memos and keeping a project web log (bogfires.blogspot.com).

Secondary data During the first and second phase, researches also gathered secondary data on music business, heavy metal genre and the case band from multiple websites, music media, documentaries and industry reports, for example the largest metal news forum blabbermouth.net and magazines such as Guitar World, Metal Hammer, Soundi and Inferno, and reports such as

Nielsen Sound scan reports on record sales. The band’s own website and social media sites were also closely followed. A documentary produced by the band on their live-DVD was also used in mapping the key events in the history of the band, as well as several television appearances of the band.

In-depth interviews The third and final part of the research project was conducting in-depth interviews with the four original members of the band in March 2011. The interview questions covered the development of these musicians from early childhood to current day and the history of the band/venture, decision-making procedures, partnering, risk-taking, marketing, roles and duties and visions of the future. These themes were covered throughout the history of the venture, from early days to breakthrough to current status. The interviews lasted about two hours each and were recorded and transcribed. Detailed descriptions of data collection in these three overlapping phases can be found in Table 1.

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Data analysis

The research was conducted using the grounded theory approach of constant comparison (Glaser and Strauss, 1967). Using an iterative process of theoretical sampling, examples from the data were compared and contrasted in developing categories that were connected in relation to the theoretical foundations of the study. The data were analyzed throughout the process of collection to confirm and test categories, which also guided the progression of the study. The categories were further refined in discussions with informants. In the end of the study, the field notes, memos and transcripts were analyzed to reconfirm the emerged decision-making logics in the entrepreneurial process.

As the key findings of the study, we identified the two logics of decision-making: (1) causal opportunity creation in the product domain and (2) effectual opportunity exploitation in the market domain. We also identified how the decision-making logic changes as ventures move from resource accumulation to the marketplace. Data structure is presented in Table 2. Next we describe the stages identified in this study and how it relates to existing theory on causation and effectuation.

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FINDINGS

Empirical studies of effectuation have addressed questions like how entrepreneurs and non- entrepreneurs process risks and returns (Dew et al., 2009; Read et al., 2009; Sarasvathy, 1998;

Sarasvathy and Dew, 2005; Sarasvathy et al., 2008) and they have employed similar types of research procedures and analysis. These studies mainly demonstrate that entrepreneurs and non- entrepreneurs generally perceive risk and reward differently. The field studies include three qualitative single-case studies using content analysis and two quantitative studies, one developing measurable constructs for effectuation and causation (Chandler et al. 2011) and the other meta- analyzing the relationship between effectuation and performance (Read et al., 2009b). (Perry et al. 2011) Conceptual studies have addressed questions such as how firms are created (Sarasvathy,

2001), what is effectuation (Dew and Sarasvathy, 2002), how do entrepreneurial opportunities come into being (Sarasvathy et al., 2003), how firms decide what to do when faced with an uncertain situation (Wiltbank et al., 2006), how do firms that are not yet established behave (Dew et al., 2008a), and how do entrepreneurs successfully create new firms and markets (Dew et al.

2008b). Other issues addressed in the literature are e.g. over-trust, creative imagination and entrepreneurial expertise. (Perry et al. 2011)

Still, little is known about how entrepreneurs use effectuation versus causation logics in decision- making in the product and the market domains they operate in. To address this gap in research, we adapt the constructs from Dew et al. (2008) in Table 3. to demonstrate the causal and effectual processes in different knowledge domains the entrepreneurs operate in.

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Effectuators are according to Read and Sarasvathy not born, but made. Read and Sarasvathy

(2005) first of all suggest that novices are more likely to be more causal in reasoning than experts. According to Read and Sarasvathy (2005), expertise, which leads to superior performance can be viewed as development through a special type of experience that involves

‘deliberate practice’, that requires motivation, understandability, feedback, repetition and fit. For an entrepreneur in creative and cultural industries this kind of motivation would consist of the satisfaction of, for example, writing and composing an album or just practicing a new technique on one’s instrument. ‘The 10-year rule’ suggests that it takes a minimum of 10 years of deliberate practice for a novice to ascend the rank of expert (e.g. McPherson, 2005). Individuals must identify some larger instrumental objective for their practice in order to motivate themselves to engage it. Research has shown that deliberate practice can be moderated by inherent enjoyment of the activity (Ericsson, Krampe, and Tesch-Romer, 1993; Ericsson and Lehmann, 1996;

Sloboda et al., 1996). In creating and performing heavy metal music, becoming an expert is a systemic, structured and organized process of developing one’s musical and dramatic skills through intensive practice (Weinstein, 2000).

Dew et al. (2008) identified five constructs (italics) pertaining to individual decisions that set apart causation from effectuation: (1) Basis for commitment, (2) stakeholder acquisition, (3) decision agenda, (4) basis for taking action and (5) givens.

Process of causation in the product domain

Causation starts with the notion that the future is a continuation of the past and that it can be acceptably predicted. Goals are given and determine project objectives. Resources are accumulated to achieve these goals. Vision of desired worlds determines goals; goals determine sub-goals, commitments and actions. Also, entrepreneur using causal logic will do what should be done based on analysis and maximization. Project objectives determine who comes on board

(Instrumental view of stakeholders). (Dew et al., 2008)

COB founders Alexi Laiho and Jaska Raatikainen started playing together in Laiho’s dad’s garage at their early teens. They both had already played other instruments: Laiho had played the piano for two years and violin for five years and Raatikainen had played the piano and the french horn. At this point they decided to commit to the instruments they favoured over others: the guitar and the drums. They had also studied classical music and appreciate the discipline and foundation it has given to further musical endeavours. Heavy metal is in fact the closest genre to classical music in modern popular music (Dunn, 2005; Walser, 1993). They both shared a love of heavy metal music and started with playing cover songs for two years. After two years of intensive practice, the duo wanted to start composing their own music and they wanted to become a real band. They were very ambitious in this personal endeavour. Music represented a larger objective for both of them. Soon after the decision was made, they found a bassist, a rhythm guitarist and a keyboard player, from their circle of friends and schoolmates. The band started to play shows at youth clubs and recording demo tapes that they sent to labels in Finland and internationally, as expected from starting bands. Throughout the early phase of their career they practiced intensely, several hours a day, both individually and together as a band. ‘Children of Bodom invested time in the band and they had a burning desire to do so.’ – Riku Pääkkönen, CEO, Spinefarm (2009) COB recorded two demo tapes that did not get responses from potential partners. The planning was short term, one demo at a time. Resources allocated to recording the demo tapes were based on how much they had to spend, and work with that. No loans were taken or big budgets were made, so the band was able to manage these ‘failures’. By the time COB had recorded three demo tapes, they finally got a response from a Belgian label. The label wanted to sign the band, but the deal they offered was ‘a rip-off’. Because it was the only offer they got they took it, even though this meant they had to cover the recording costs and sell (buy) a large amount of the albums themselves. Because they had to fund the recording themselves, they went to a studio they had used for recording their demo tapes in Lappeenranta and recorded the whole album in one week. Usually heavy metal bands take at least 6 weeks to record a full-length album, a luxury they couldn’t afford, with covering the costs themselves. Before the album was cut, a personal contingency occurred. A friend of their rhythm guitarist worked at the Finnish independent label Spinefarm, and he had passed the album to the label AandR, Ewo Rytkönen, who immediately wanted to sign the band. After changing their name (to escape the deal they had already made), the band was signed to Spinefarm. During COB’s debut release, the band had no expectations regarding the sales of their first album. They felt their style was not commercial enough to appeal to larger audiences. COB had stayed loyal to their style and genre of music, even though it could have been characterized as non-commercial at the time. They also got a good recording deal based on their personal contacts. With this deal in their pocket, they had access to Spinefarm’s resources. Most importantly, the international links to other labels and distributors were now at the reach of COB. Soon they had signed licensing deals to central Europe and Japan, through Spinefarms network and started touring with bigger names in the metal scene. Slowly but surely budgets for albums grew and the band climbed their way up the tour bill. Planning was short term, one album at a time. The environment was unpredictable for the band, with always having to deal with the possibility that what if the fans don’t like the next album. In 2003 COB realized they needed a professional manager and relied on their friends’ advice, and signed with a German management and booking agency Continental Concerts. With the help of their professional managers, they were able to sign better contracts with labels and book better tours and festivals, with growing record sales and increasing number of markets they operated in. The band was incorporated in 2003 and keyboardist Janne Wirman became the CEO of the company. Around the same time bassist Henkka Seppälä took charge of the merchandise business and overall communication of the band. The band has had some changes in their line-up over the years. New members have always been friends or acquaintances of the members. Instead of searching for the most talented and skilled individuals, they have rather chosen the people they know, like and trust. Thus sometimes they have been the most talented and skilled individuals available. A more comprehensive history of the venture is presented in Appendix.

The given goal of these entrepreneurs was to become the best band in the world, to be admired by others, and on the semi-realistic end, make a living playing in a heavy metal band. In order to succeed in this endeavour, the band set out to accumulate the resources needed to achieve this given goal. The actions taken were endless hours of practice on one’s instrument both individually and as a band together. Instead of choosing the easiest way to make a living by playing music, for example playing in a cover band they wanted to be admired on the one hand and stay true to who they were on the other hand, so their choice was to invest all their time and money in becoming technically competent musicians and beyond. Instead of aiming at radio play and contract with major labels by playing pop or rock music, they chose to play metal that was at the time and still is, a marginal genre in popular music, with a tight but small community of loyal followers globally. They invested all the money they had and what they could make in band gear and recording demo tapes. Vision of the desired world determined the goals; goals determined the sub-goals, commitments, and actions. They did what they thought they ought to do, practiced as hard as they could, composed the best metal songs they could, played shows at youth clubs and recorded demo tapes, which they sent to labels in Finland and abroad. Their view of stakeholders was instrumental, in a sense that if someone didn’t give 100 % to the band, if they didn’t have the right skills, ‘look’ or more importantly attitude, they were out of the band. Project goals determined who came along. See Table 3. for more data. The only causation construct we did not find validation for was competition in attitude toward others. The band perceived other bands as friends and colleagues, they were even fans of them, but due to differences in musical styles, they were not considered competitors.

Aligned with Shane (2000) we find that these entrepreneurs operate in two separate knowledge domains (corridors). First being the product (instrumental knowledge) domain, where acquiring knowledge is a causal process, as seen in quotes from the data in Table 3. Thus it is a demanding process that one needs to commit to, actually becoming an expert in one’s field, be it for example computer programming or playing a musical instrument. We suggest that the musician entrepreneurs go through a phase of deliberate practice, to become experts in their field of art.

Becoming an expert in writing and performing music is developed through a combination of strictly technical mastery of one’s instrument and also developing an artistic style. (Weinstein,

2000) We find that the process of becoming an expert is a process of causation, taking place in the product domain of instrumental knowledge and learning. The process of causation, the process of knowledge acquiring and building expertise creates entrepreneurial opportunities for the venture. Our data also implies that this causal process in the product domain occurs mostly within the constructs pertaining to individual decisions, not necessarily in terms of environment.

Proposition 1. In fields where contextual instrumental expertise is of utmost importance, entrepreneurs use causation logic in opportunity creation, more specifically, acquiring the expertise (accumulating human capital) required in building a competitive product.

Process of Effectuation in the market domain

Effectuation starts with the notion that as long as we can control the future, we don’t need to predict it. Future is created through contingent actions of wilful agents. In effectuation logic, means are given, and entrepreneurs create effects with the means at hand. Means and stakeholder commitments determine possible sub-goals, goals emerge through aggregation of sub-goals

(Possible worlds). Entrepreneurs do what they are able to do based on imagination and satisficing

(Can). In effectuation logic, who ever comes on board determines project objectives

(Instrumental view of objectives).

The band was set on the type of music they wanted to create and perform. In other words, their means were given. They were not willing to compromise the content of their product, but they were willing to be flexible with who to work with and what kind of effects can be created. When the band had recorded demo tapes, they sent them to potential partners, and worked with whoever was willing to work with them and did everything they could (can). This strategy led to partnerships, some of which were mutually beneficial and some of which were not. When the band signed with Spinefarm, the label that invested money and time in them, and the band followed the sub-goals determined by Spinefarm. Later their management company, Continental

Concerts, determined the sub-goals. So their partners determined the market objectives as the band stayed in charge of the product content- both musically and visually. (see Table 3.) In the market domain, in exploiting opportunities, the band has used effectual logic. The market domain is less predictable than the product domain, because changes in cultural interpretations of appropriateness and value, being produced through complex social interactions (Autio et al.,

2012). For this venture, the future has not been predicted, but rather created. The venture has also done what they have ‘been able’ to do instead of what they ‘should have’ done. Their action is based on the means: who they are, what they know and whom they know. Instead of fixing a goal

(e.g. becoming a financially successful band, where focus would be trying to get a record deal with a large record company with plenty of financial resources, and compromising one’s musical preferences in order to get radio airplay) they have fixed their means, who they are, what they know musically and who they know from the music industry. They have only taken affordable financial risks, instead of focusing on expected return.

Proposition 2 a. In fields where contextual instrumental expertise is of utmost importance, entrepreneurs use effectuation logic in opportunity exploitation, in the market domain. Hence, entrepreneurs are flexible regarding marketing and sales attributes.

Proposition 2 b. In fields where contextual instrumental expertise is of utmost importance, entrepreneurs don’t use effectuation logic in opportunity creation in the product domain. In other words, entrepreneurs are not flexible regarding product attributes, but follow their original product vision.

DISCUSSION

We set out to discover how entrepreneurs apply effectual and causal logic in the different decision-making domains, product domain and market domain. We found no examples in the existing effectuation literature that would consider the different contexts and context related aspects of using causation or effectuation logic in venture creation. Intuitively there is a remarkable difference between starting a restaurant or a barbershop and founding a biotechnology venture or a music group. Another notable gap in existing literature is the lack of research in effectuation in internationally successful ventures. Ventures operating internationally must be able to produce internationally appealing products and/or services and market and sell them internationally. That requires a different mind-set, both in the product domain and the market domain.

First of all, we find that the causation process in the band that we have studied is more advantageous in the kind of ‘deliberate practice’ (Read and Sarasvathy, 2005; McPherson, 2005) that forms the foundation phase upon which superior expert practice is built and that, in turn, is a necessity for building internationally appealing novel and authentic products. We find that during this process, which starts with an entrepreneurial intent in becoming a musician or a rock star, the entrepreneurs create the opportunity by acquiring instrumental knowledge in a specific field. In other words, the expertise in the field is acquired through a process of causation, when the entrepreneurs are novice musicians. They invest time and money in becoming experts: individual practice, learning music theory and rehearsing together as a group. Their agenda was primarily acquiring the resources required to develop a career out of musicianship, as a member of a successful band. Their decision-making was highly goal oriented and the project agenda defined who come on board: who had the required skillset and attitude. This expertise become their most valuable resource and core competence as a venture. In the product domain their goals are given, they accumulate the resources required, visions of desired worlds define the goals, they base their action on what they should do and their project goals determine who comes on board.

It is when the entrepreneurs become experts in their field when their ventures are more likely to use the effectuation process, and move to the process of entrepreneurial opportunity exploitation.

The market domain is unpredictable and entrepreneurs need to be flexible in facing the changing market environment. What is notable here is that these entrepreneurs are only flexible regarding market opportunities. That is, they are not willing to make changes to the core product.

When the decision domain shifted from ‘what kind of music we learn, write and perform’ to

‘how to get our music to our potential audiences’ the strategy shifted from causation to effectuation, when the entrepreneurs had become experts in music but novices as entrepreneurs.

The shift is more eminent in the individual decisions (Means, Effects, Possible worlds, Can and

Instrumental view of objectives) than in responses to the environment. (See Table 3.)

Decisions in the product domain still remain project and goal oriented, as decisions regarding market domain shift to effectuation. In the entrepreneur’s own words: ‘we worked with who ever wanted to work with us’.

We find that both processes are necessary for the development of the venture: the causal process of developing contextual instrumental expertise and creating the opportunity and the effectual process of exploiting the entrepreneurial opportunities. In this sense we find that these opportunities are not pre-existent but actually created (made) by the entrepreneurs. In contrasting our findings to existing empirical studies in effectuation (e.g. case Uhaul), it seems our findings resonate more with ventures that have more complex products or services that require particular instrumental expertise, passion and dedication and that are internationally appealing. Our data implies that the managers and labels have also tendencies to use either causation or effectuation processes in their decision-making. Expertise built through extensive experience in the field of music management tends to lead to superior performance. In management practices we find divergence in expertise and experience in the field but also in competences, commitment and areas of specialization. Our research also implies that the longer the venture can operate independently, the better bargaining position they have in negotiating with potential business partners. This is due to the time and effort invested in the venture development, and applies in ventures regardless of industry.

To conclude our findings: We find that these entrepreneurs operate in two different but intertwined decision making domains: the predictable product domain of instrumental expertise and the unpredictable market domain. The instrumental expertise is acquired through a process of causation, which is followed by an effectual process in the market domain. Existing research has focused efforts on studying expert entrepreneurs who use the effectual process. Our empirical analysis of venture represents a clear case of instrumental expertise leading to effectual process with no experience or specific expertise in entrepreneurship.

Theoretical contributions

Venkataraman et al. (2012) identified three major streams in the slowly maturing field of entrepreneurship research during the last decade. First being the more nuanced view of entrepreneurship, covering cognition, emotion, learning and expertise (e.g. Cardon et al. 2009).

Second is the on going theoretical debate about opportunity creation versus discovery (Barreto,

2012). Third major stream is the identification of specific mechanisms of entrepreneurial action, such as bricolage (Baker and Nelson, 2005), improvisation (Hmieleski and Corbett, 2008) and effectuation (Sarasvathy, 2001). Next we present the theoretical contributions of this paper by utilizing the above categorization.

First and foremost our study contributes to the specific mechanism of entrepreneurial action: effectuation. We find that entrepreneurs operate in two very different knowledge domains or corridors: one related to their core product and one related to the market. Our study contributes to the effectuation literature by recognizing that entrepreneurs use causal and effectual decision- making logic simultaneously in these separate knowledge domains. On the one hand they use causal logic in developing expertise in the product domain of their specific field. Once the entrepreneurs have become experts in their field, they start using effectual logic in the market domain, as a novice entrepreneur. The contribution of our study to the effectuation stream of research is distinguishing product and market related decisions on one hand and fields where complex instrumental expertise is of utmost importance from those that are at the reach of everyone.

Novelist Paulo Coelho has stated that ‘passion and enthusiasm make things possible, not easy’.

This is especially true in entrepreneurship. Expertise, though it might be fueled by passion and excitement towards an activity, is built through extensive practice, guidance and encouragement.

According to Bloom (1985) it is only when a certain level of expertise is achieved that differences between talented and non-talented individuals start to show. One must be dedicated to the field and activity and enjoy doing it. Our research confirms these notions on expertise. The founding members dedicated all their time and money in music. We find that it is these sacrifices and investments in learning and knowledge that creates the opportunities for the entrepreneurs.

The entrepreneurial opportunities are created by building expertise in the product domain.

Getting a Ph.D. in biology or chemistry would be a type of an investment a field of knowledge, that would allow one to create entrepreneurial opportunities in biotech, for example, or learning computer programming and creating opportunities for oneself in the software business. Expertise is a key building block in entrepreneurship influencing both the types of opportunities available for the entrepreneur and the approach the entrepreneur takes in exploiting them. As an example, facebook was founded by Mark Zuckerberg, a computer programming wizard, not the

Winklevoss brothers, who came up with an idea of such website. Also, it was two Ph.D. students of computer science at Stanford, Larry Page and Sergey Brin founded Google. Our study contributes to the expertise literature by explaining the process of becoming an expert is a process dominated by causal logic in decision-making.

How opportunities come to be is a crucial debate in entrepreneurship research field. Where some see it as a discovery process, others see it as a creation process and some even as interpretation

(Barreto, 2012). Our study identifies the process of becoming an expert in one’s field as the creation of opportunities. Still our study makes a distinction between different types of opportunities. While U-haul might have been out there for anyone to discover, there are fields that require special knowledge and skills. For example biotech or software opportunities are not at everyone’s reach but only the group of people who have specific contextual instrumental expertise in those fields. And of course, not every expert exploits entrepreneurial opportunities.

But expertise forms the base foundation on opportunity exploitation in these fields.

The fourth contribution of this study is to research on creative and cultural industries. In this paper, we applied Saravathy’s (2001) effectuation theory into an empirical setting where it has been not applied before, music entrepreneurship in the field of heavy metal, which is a setting where contextual instrumental expertise is of particular importance. The paper extends out knowledge on musician entrepreneurship but also the rich description on the context also extends our understanding of music industry as a business environment.

Limitations and future research directions

In this study we chose to take an ethnographic and grounded approach to the study of entrepreneurial decision-making and its logic in different knowledge domains. In qualitative research understanding replaces generalizability and explanation replaces measurement (Miles and Huberman, 1994). The strength of this study is the rich data, providing us with a thorough understanding of the context the entrepreneurs operate in and how it may or may not influence the decision-making logic of the entrepreneurs under study. Nevertheless, we find that the results are generalizable in other fields with similar expertise requirements, such as software or biotech.

We recommend our propositions to be tested with larger samples of ventures, either qualitatively or quantitatively.

Contributions to practitioners

What makes the approach taken in this paper a novel one is that originally (from the 1960’s to the

1980’s), heavy metal bands got rejected by radio and by major labels. This forced them to be more entrepreneurial than artists in the mainstream of popular music, for example. Many of the gatekeepers in the cultural industry of popular music have been recently pushed to background as a result of technological advances of the internet and music recording programs, that have shifted the social practices and buying behaviour patterns of consumers, not only in the field of popular music but also in other fields of music as well. Our study also provides valuable insights to practice community, in terms of developing globally successful artist. What we find especially beneficial are the learnings from heavy metal niche to popular music in general, but also the fact that projects with no initial commercial appeal can find their ways to audiences’ hearts when the artists are talented, committed and passionate about their music.

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Table 1.

Expert Interviews duration Music Export Finland 4h Lamb of God/ Randy Blythe 1h Nuclear Blast Europe 2h SonyBMG Finland 1h Universal Music Finland 4h EMI Music Finland 1h Hype Productions 2h Spinefarm Records 3h Fontana Distribution 4h Kingfoo Entertainment 4h Continental Concerts 2h Nuclear Blast, USA 4h Century Media, USA 2h Good Fight Entertainment USA 2h

Participant observation on tour 2008 San Jose, Long Beach 21h 2009 Vancouver, New York 19h 2010 Tokyo 8h 2011 Copenhagen 10h

In -depth interviews (2011) Aleksi Laiho 2h Jaska raatikainen 2h Henkka Seppälä 2h Janne Wirman 2h

Conventions IsThisIt 2009 3 days MUSEXPO 2009 3 days MUSEXPO 2010 3 days ASCAP EXPO 2010 3 days Musiikki ja media 2010 3 days ASCAP EXPO 2011 1 days SXSW 2011 8 days Finnish women in music export 1 days

Secondary Data (2008-2011) Nielsen Soundscan www.blabbermouth.net www.scythes-of-bodom.com www.cobhc.com www.facebook.com/childrenofbodom www.myspace.com/childrenofbodom Chaos ridden years- documentary Soundi magazine subscription 2003-2011 Metalhammer magazine Revolver magazine Guitar World magazine Inferno magazine YLE TV: Rock Suomi: Raskassarja

Table 1. Data collection 2008-2011.

democratic administration development leader Desicion-making marketing enhancing Competence ever Partnerships objectives Recruites goals Vision product Resource economic objectives Motivation First order codes

will , in tastes

based

objectives

charge work ).

) . (social

accumulation based product

capabilities voting

, based , on

traits

focused marketing formed

with tasks of on product : rather on on and . ( one product not

product our divided on ”with issues product

.

skills creative

product and

than based related

, who .

on

”.

  (in the - - maintain - divided - - Market economic - position in the the - - - - - Product Theoretical categories parnerships recruites compromising decision-making partherships maximizing product product-based product defines defines creative market

landscape

landscape resource overall product ) -related objective

based

leader

define

) product based internal

on social economic goals recruits vision

decisions

( accumulation : democratic as : inventor action and on

basis attributes

hierarchy contingencies

aspects returns for action made , leading , tasks goals (

) non

to by

  Aggregate theoretical dimensions - goals - - Effectual - - ( - ( Causal contingency- means/stakeholder means inventor product product

( opportunity product

) ) opportunity leads objectives goals

based

decision-making

) define are

commitment

action creation

given define

action exploitation

stakeholders :

define :

Table 2. Data structure. Causal logic Product domain Constructs pertaining to individual decisions

Givens Goals 'At the age of 13 I told my parents that I hate school and I’m not going to upper secondary school because I just want to play the guitar.'; 'My principle is that as long as I can make a living with music and I have a roof over my head I’m happy. Of course it’s nice to be able to earn enough to buy cars, but that’s all a bonus.' Decision agenda Resources the band spent all their time and money on music; time in rehearsing and money in equipment and recording demo tapes, thinkin that it would provide a living for them; of course there were no guarentees. Basis for taking Desired worlds 'the dream was to become a star, to be the best band in the world. action Building a reputation and a name was the most important thing, you didn’t think about money back then. As long as I can play and people will listen, and admire you…being the world’s best drummer… very naïve dreams.'

Basis for Should 'When I finally got a space where I could practice drums, it was 6-7 h of commitment practice per day, Monday to Friday, and sports during the weekend. That’s what you have to do at some point if you want to become a professional musician, that’s how you build the foundation, after which you can start enjoying music.'

Stakeholder Instrumental view of stakeholders (product goals determine objective) 'It was so acquisition ambitious, even at a very young age, that if a member didn’t deliver 100 % of themselves, they were out of the band. “In order to become a member in this band the guy needed to be a good musician. But that wasn’t enough, the attitude had to be right also, no fake rockers for sure.'

Constructs in terms of responses to the environment Predisposition Expected return I just blindly put everything I had in drums, thinking that this will toward risk someday become a vocation. But there was no guarantee, but I didn’t think about that then. Predisposition Avoid there were no contingencies in creating the product, the musical style and toward attitude came natural to them, it was what they themselves would have wanted to contingencies listen to. Attitude toward Outcomes success defined by the quality of the product success/failure Attitude toward Update beliefs and expectations were irrational and unrealistic probability estimates Attitude toward Competition* 'Other bands at the time represented other styles, like Nightwish and others Stratovarius, we liked their music and didn't consider them as competition'

Effectual logic Market domain Constructs pertaining to individual decisions

Givens Means COB had stayed loyal to their style and genre of music, even though it could have been characterized as non-commercial at the time, in other words their means were fixed (who I am, what I know). 'In the beginning, we worked with anyone who agreed to work with us. We got management around our fourth album, we were rolling by ourselves for quite a long time.' Decision agenda Effects I remember when our firs album came out, our goal was to sell 1000 copies in Finland. (later the album was awarded gold album status in Finland, 15 000 copies sold and 30 000 units had been sold in the U.S. in 2009) Basis for taking Possible worlds The music of their choice and the partners they found determined action thegoals, subgoals and action. 'Our music is not commercial, and everyone knows that. Despite that, we keep on going, flat out. It tells you something about the attitude we had and still have. And set our goals like, if it sells one thousand copies, then great. It’s like you realize this is not commercial music, but if we can make living doing this, that’s great.' Basis for Can they had to fund the recording of their first album themselves, they recorded the commitment whole album in one week. 'Getting a record deal kicked us in the direction of realizing our dreams and we thought now we need to work twice as hard…we rehearsed and rehearsed even if there now gigs planned or anything…there was no time for anything else in our lives.' Stakeholder Instrumental view of objectives (stakeholders define goals) First the Belgian label set acquisition the market goals, causing the band to cover recording costs themselves and purchasing copies of the album themselves. After escaping the deal, Spinefarm set the market goals and started internationalizing the band by licencing and sending the band on international tours. 'We never had a strategy. At least in the beginning. When we got management they crated schedules, which is sort of like strategy'. Constructs in terms of responses to the environment Predisposition Affordable loss Resources allocated to recording the demo tapes were based on how toward risk much they had to spend, and work with that. No loans were taken or big budgets were made, so the band was able to manage these ‘failures’ Predisposition Leverage A friend of their rhythm guitarist worked at the Finnish independent label toward Spinefarm, and he had passed the album to the label A&R, Ewo Rytkönen, who contingencies immediately wanted to sign the band. Attitude toward Process failures managed by taking affordable risks success/failure Attitude toward Manipulate conditionals they created the market for themselves by partnering and probability touring massively, especially in Europe and North-America estimates Attitude toward Partnership 'We chose this management company because they seemed like fair guys… others Back in the day it was important that they were like friends to us. Nowadays music industry is so messed up that nothing else matters than money.'

Table 3. Summary of differences in data between market and product domains (adapted from Dew et al. 2008)

APPENDIX

Children of Bodom (COB) case history

Children of Bodom (COB) is heavy-metal band that was formed in 1993 in Espoo (in the

Helsinki region), by Alexi Laiho (guitars and vocals) and Jaska Raatikainen (drums) who were

14 years old at the time. Henkka Seppälä (bass, 1995), Alexander Kuoppala (guitars, 1995) and keyboardist Janne Wirman (1997) joined the band later. Laiho who is mainly responsible for creating the content, started playing guitar at the age of 12. He had played the violin for several years already, but listening to his older sister’s heavy metal albums made him want to play the guitar instead. Eventually his father caved in and bought him his first guitar and an amplifier.

‘That’s all I wanted to do. I wanted to be one of those guys I would look up to whether it was Slash or Steve Vai or everything in between. That was my objective. I was just so f- cking eager to learn every technique that there was in the world. I went to music school and stuff like that. I learned about musical theory and stuff like that. Whenever I heard any kind of guitar playing, I was always observing what they do whether it be arpeggios or melody. I mastered – in my opinion is the hardest technique ever if you want to do it right pure and clean – is the sweep pick. I mastered that way before I got my alternate picking right. It’s a funny thing, but I don’t think I’m the only guy who does that. Then the alternate picking thing, it’s pretty f-cking hard. You really have to keep up with it. You have to practice every day just to keep up with the technique just to do it right. That’s the thing that comes down to the music. It’s about the riffs.’ – Alexi Laiho (2011)

After graduating from comprehensive school at the age of 16, Laiho concentrated on developing his musical skills, instead of continuing studies in upper secondary school, as the majority in this age group does. Laiho’s musicianship was sponsored and supported only by his parents at this point. Jaska Raatikainen had played the French horn since the age of nine but he lost interest in a few years and started playing dums, the instrument he was most passionate about. Together the duo started rehearsing and recruited other members to their band. Keyboardist Janne Wirman had a formal training in music and classical piano background. Henkka Seppälä, the bassist, was self taught with some experience on the guitar and piano.

‘We started the band in 1993. In 1995, kicked out the second guitar player because he was more into drinking than rehearsing. Then the guy playing now, Alexander turned out to be a pretty cool guy; pretty good guitarist. Then I just asked him if he wanted to joint the band. We started without a keyboard player. We took one in '95, which is actually the same guy that used to play guitar, which is pretty fucked up. He played for a couple of years, from 1995 to 1997. He was good and rehearsed with us a lot. In 1997, we became frustrated. We were rehearsing like hell, but didn't get a record deal or anything like that. Then he would mess around and not come to rehearsals - I don't know what the fuck he was doing... I was quitting the band twenty times all the time. I don't know, something just kept me going. I didn't ever believe that anything would ever happen.’ – Alexi Laiho (1999)

By 1996, COB had already recorded three demo tapes and played some gigs at youth clubs and schools in Espoo, Helsinki and Kauniainen and at one festival in Lappeenranta.

The band members sent their second and third demo tapes to several record companies, including

Spinefarm and Nuclear Blast (who have later represented them), but none of them were interested in this melodic death metal band. Then the band got an offer from a Belgian record label. They took the deal, even though the label did not compensate the recording costs of the album nor did they have enough money to promote the album. On top of that, the band was forced to sell 1000 copies of the album themselves. This was still the only offer they had received so far, so they took it. They entered the studio to record the self-financed album called ‘Something Wild’ with seven songs on it. The cost of this album was approximately 8000 FIM (approximately 1350 €).

After the album was produced and raw mixed, Alexander Kuoppala gave a copy of the album demo to one of his workmates, Sami Tenetz, who gave the album to Evo Rytkönen at Spinefarm

Records, an independet Finnish metal label. At this point the album was not cut yet. ‘After

Spinefarm Records received Children Of Bodom’s ‘Deadnight Warrior’ demo, it didn’t take long for the company to figure out what they had in their hands back in late 1996. Three spins of ‘Deadnight Warrior’ later, the band was signed and ready to knock a few heads off.’ COB signed a three-album deal with Spinefarm Records and changed the band’s name to COB to escape the deal they had made with the Belgian label. The Belgians were told that Inearthed had split up.

The contract included Alexi Laiho’s, who wrote all the music of COB, publishing deal with

Ranka records, the Spinefarm’s sister company.

‘Even before we released this album, we played a gig supporting Dimmu Borgir in Finland; there was one guy from Nuclear Blast, just watching the gig. He saw our gig first and said to our label manager that Nuclear Blast wanted to sign us on a licensing deal or something like that. It's working pretty well. I think it's pretty good for us to be at this point. Spinefarm is a small label, but it's big enough to do the promotion in Finland and Scandinavia. It's kind of like they are a small label and we are kind of a big band for them. They treat us pretty well and take care of us. If we were just on Nuclear Blast, then I think that we would be just another Nuclear Blast band. They have a lot of bands. They are really good with promotion when it comes to Dimmu Borgir, HammerFall or bands like that, but there are too many bands that Nuclear Blast doesn't do anything for. But they have done pretty good promotion for us.’ - Alexi Laiho (1999)

COB played their first gig at Lepakko as opener for Dimmu Borgir, a famous metal band from

Norway. Someone from the German metal label, Nuclear Blast saw the gig and asked Spinefarm

Records label manager for a licensing deal for Nuclear Blast to release the album in the rest of

Europe. COB became a well-known band in the Finnish metal underground scene and their track

‘Deadnight Warrior’ was released on a compilation from Spinefarm called Metalliliitto.

Spinefarm Records released ‘Something Wild’ in November 1997. The album debuted on number 35 on the Finnish album charts and climbed up to number 20 in the following weeks.

This was highly exceptional for an extreme metal band. In early 1998 Nuclear Blast released the album in Central Europe and Toy’s Factory in Japan. UK and US sales were based solely on imported albums and Spinefarm distributed the album in the nordic countries. COB filmed a promotional video of ‘Deadnight Warrior’ with a budget of 5000 FIM (approximately 840 €).

Nuclear Blast released ‘Something Wild’ in Europe on February 2nd in 1998. On March 3rd

COB started a Eurpean tour, opening for Disbelief, Crack-up, Covenant, Hypocrisy and

Benediction. Before this, the band had only played gigs in Finland. The tour was a success and

‘Something Wild’ sold 5 000 copies in Finland and 12 000 copies internationally. According to

COB frontman, Alexi Laiho the tour was extremely important for the band, because nobody outside Finland knew them before this tour. In August 1998 COB played at the Wacken Open-

Air metal Festival, the biggest metal festival in the world and impressed more people with their unique style. In September 1998 COB opened for a Finnish metal band Impaled Nazarine in St.

Petersburg in Russia. In September another Nuclear Blast European tour with Dismember and

Racehell followed and this time they got a higher place in the billing. At this point ‘Something

Wild’ had sold already 40 000 copies internationally and less than 15 000 copies in Finland.

Later in 1998 COB entered the studio to record two new tracks. The track’ Children of Bodom’ was released as a single in Finland with two other Spinefarm bands’ tracks and entered the number one spot on the Finnish single chart and stayed there for eight weeks. Later it sold gold (5

000 copies).

‘When we did the album, and after we finished, I was convinced that no one was going to buy this shitty album and no one was going to like it, because I thought it was too black metal for heavy metal fans and maybe too heavy metal for black metal fans. So we didn't expect something like this would happen. So, in Finland it is selling pretty well. We released the single ["Children of Bodom"] a couple of months ago and it went to number one in the single charts for two months.’ – Alexi Laiho (1999)

The second album ‘Hatebreeder’ was recorded between December 1998 and January 1999 in

Astia Studio Lappeenranta. It was released in Finland in February 1999, hit number 20 on the album cart and climbed up to number six in the following weeks. Single release ‘Downfall’ was released two weeks before the album went gold and hit the number one spot on the Finnish single chart. COB also filmed a promotional video for Downfall directed by Mika Lindberg. In March

1999 the album was released worldwide. In Germany it reached number 76 in the album charts.

During the summer -99 COB toured Finland and Europe. In June they did three sold out gigs with an audience of 1500 each in Japan with Inflames and Sinergy and recorded a live CD: ‘Tokyo

Warhearts-Live in Japan’. ‘Tokyo Warhearts’ came out as a limited digi-book-edition in Europe in October 1999 and the 20.000 copies of it were sold out. (Spinefarm Records, 30.10.2008) The live album hit the Finnish album chart number 33. In September 1999 COB toured Europe with

Dark Tranquility, Inflames and Arch Enemy.

In December 1999 COB entered the studio to record a new single, Hate me! which was released in 2000 and sold platinum (10 000 copies). In summer 2000 COB played at two festivals in

Finland, at Ilosaarirock in Joensuu and at the metal festival Tuska in Helsinki. They also played one gig in Canada, in Montreal and in the US in Milwaukee Metal Fest XIV. In Milwaukee COB met with Nuclear Blast America that was a joint venture with Century Media to promote Nuclear

Blast bands in the US. They were really excited about COB and they had plans to start promoting them in the US market. Shortly after the festival Nuclear Blast America was bankrupt and COB needed to find a new distributor in the US. At this point ‘Hatebreeder’ had sold approximately 70

000 copies internationally and less than 15 000 in Finland. The third studio album ‘Follow the

Reaper’ was recorded in August 2000 in Sweden at Peter Tätgren’s legendary Abyss studio.

‘Follow the Reaper’ was released October 30th 2000 in Finland and January 22nd in the rest of the world, except for Japan, where the album was released December 20th 2000. The album landed number 3 in Finnish and 46 in German album charts. In December 2000 COB played some shows in Finland. In spring 2001 COB went on a double headlining tour with Primal Fear and Scared Steel in Europe. After the tour COB went back to Japan and played their first ever gig in South Korea. The gig was also aired in Korean television. On October COB played et the

Polish Mystic Festival and on 17th they opened for Slayer in Italy in front of a massive crowd.

Then the band played eight shows in South America and after that a couple of shows in Finland before taking a little break. The international sales of ‘Follow the reaper’ were 130 000 copies and on domestic markets less than 15 000 copies. By that time COB albums had already sold altogether 40 000 copies in the US as well. The band was looking for a new record deal, after releasing the three albums with Spinefarm in Finland, Nuclear Blast in Europe and Toy’s Factory in Japan. Toy’s Factory also released a best-of collection of COB from the first three albums in

Japan called the Bestbreeder in 2002.

The touring that followed the first three albums did not bring any income to the band, but was rather seen as a marketing activity. The only income the band got at this point were the royalties from the record sales. Majority of the income went to Spinefarm Records, who had invested in the band, and the licencors abroad. The investments Spinefarm made in COB included the touring costs (expenses and fees to the headliners), marketing costs (promotional videos and advertisements) and recording costs (recording, cover art, photographs). These expenses were deducted from the royalties of the band.

In 2002 the band contacted a German management agency Continental Concerts, who was recommended to them by friends from another Finnish metal band, Stratovarius. They signed a managing and booking contract with Continental Concerts after which all contracts and bookings were handled by professional managers. The band was also incorporated during that time. The next three album contract was signed with Universal Music (that had acquired Spinefarm) globally and the albums were distributed globally.

Their fourth album ‘Hate Crew Deathroll’ was released in the U.S. by Century Media, since

Universal Music was not interested in the release at that time. The band had already gained some underground following there resulting in the increasing use of internet in discovering new music and some speciality stores selling the import albums there. The band toured in the U.S. at the bottom of the bill several times with bigger names such as Iced Earth, Lamb of God and Fear

Factory. Persistent publicist at Century Media pushed the band in media and on tours and his and the bands hard work paid off when the album sold 60 000 and they got the front man Laiho in the cover of Guitar World magazine, after which other magazines came to them. The band had become relatively established at this point and Universal Music’s distribution company Fontana has released the following albums.

Manager Paul Conroy who had been working in the industry for over a decade first witnessed the increasing following of COB as the manager of Lamb of God, a big name in the metal scene. The bands toured together and Conroy reports hundreds of people leaving the venue after COB show and not staying to see the headlining bands Fear Factory and Lamb of God. Conroy was really impressed. As the bands success in the U.S. market grew Continental Concerts felt that they no longer had the competences or connections to handle COB’s U.S. management and Conroy took over the management in North America. This collaboration resulted in working closely with the label and ESP guitar and bass endorsement in combining efforts in marketing and other campaigns. Alexi Laiho’s signature model ESP guitar has been the second most selling ESP guitar in the U.S. after Metallica’s Kirk Hammet’s resulting in additional income and recognition for Laiho.

The releases of the fourth, fifth, sixth and seventh album were followed by massive global tours and eventually the band was able to headline in all their markets, which meant more income for the band. All of these albums reached the number one spot on Finnish charts and good positions on many European charts as well. The sixth album ‘Blooddrunk’, even hit the U.S. Billboard chart on spot 22.

‘To me, the goal in this band is to just keep on doing music as we are doing now and to enjoy it quite thoroughly. We never really set up any formal goals, but we want to keeping enjoying writing our music. We also want to enjoy the touring life that we do now. Every night it’s fun to get on stage to play these songs for the fans. Keeping this up for a long time would be our biggest goal and biggest achievement.’ – Henkka Seppälä (2011)

By 2012, COB had sold over 500,000 albums in the U.S. and over a million records globally.

Alexi Laiho’s innovative reinvention of many guitar-playing techniques were recognized in the

U.S. music media, leading to his consecration in Guitar World magazine as the most promising young guitar player in 2006 and as the best metal guitarist in 2009. COB has also been called

‘technically dazzling’ by the New York Times and ‘One of the most talented metal bands of our time’ by contemporary media conglomerate VICE.