Business ownership experience, entrepreneurial behaviour and performance: novice, habitual, serial and portfolio entrepreneurs

Recent media reports have drawn attention to entrepreneurs who have successfully owned several businesses. Entrepreneurs who have owned at least two businesses are known as 'habitual entrepreneurs'. However, not all habitual entrepreneurs are consistently successful. Further, studies show that habitual entrepreneurs are heterogeneous. A distinction has been made between portfolio entrepreneurs (i.e., those who own multiple businesses simultaneously) and serial entrepreneurs (i.e., those who have owned multiple businesses sequentially). It has been argued that to really understand entrepreneurship, there is a need to understand habitual entrepreneurs because they have been able to move down the experience curve with respect to the problems and processes of owning a business. If habitual entrepreneurs are distinct from other groups of entrepreneurs such as novice entrepreneurs (particularly in terms of superior performance), then there may be advantages associated with identifying their practices. Practitioners, such as providers of finance, can make sure that the qualities of habitual entrepreneurs are present in the entrepreneurs they choose to find. Policy-makers wanting to maximise the return on their investments may provide financial support to this group. In addition, guided by the knowledge of how habitual entrepreneurs behave, support can be directed to novice entrepreneurs to encourage best practice. In this study, the theoretical rationale for distinguishing between these groups is provided using human capital theory. Business ownership experience is viewed as one component of an entrepreneur's specific human capital. In particular, it is argued that as a result of their experience, habitual entrepreneurs may have had an opportunity to develop other aspects of their human capital to a greater extent than novice entrepreneurs. Consequently, one objective of the thesis was to identify differences in the human capital profile of habitual and novice entrepreneurs. The results of the study show that while similarities exist, habitual entrepreneurs display different human capital characteristics than novice entrepreneurs. Further, portfolio entrepreneurs also display different human capital characteristics than serial entrepreneurs. The thesis also explored the relationship between business ownership experience and entrepreneurial behaviour as well as performance. The evidence indicates that habitual entrepreneurs do not search for more information than novice entrepreneurs but they do use different sources of information. Further, habitual entrepreneurs (in particular portfolio entrepreneurs) identify and pursue a significantly greater number of opportunities in a given period. Using a variety of entrepreneur and firm-level performance measures, habitual entrepreneurs do not out-perform their novice counterparts. Interestingly, neither those habitual entrepreneur-s who had been consistently successful, nor those who had previously failed, report superior performance to novice entrepreneurs. On the basis of the findings presented in this study, a number of policy suggestions can be made. Unfortunately, as no particular group of entrepreneur was associated with superior performance, the recommendation than financial support be targeted to a certain group could not be made. However, given relationships between other aspects of human capital and performance, some suggestions for support, particularly in terms of training are offered. Given identified differences in the human capital and behavioural profile of novice, habitual, serial and portfolio entrepreneurs, a case for tailored support is made

Do entrepreneurs always benefit from business failure experience?

Business failure and its effect on entrepreneurial engagement has attracted substantial scholarly attention in entrepreneurship research. We contend that knowledge is lacking on the entrepreneurial learning mechanism and entrepreneurial alertness condition under which business failure experience influences new venture performance. In an empirical examination of 240 entrepreneurs operating in multiple industries in a sub-Saharan African country, we use a longitudinal data set to show that business failure experience does not always influence new venture performance. Rather, business failure experience influences new venture performance when it is channelled through entrepreneurial learning under conditions of increasing levels of entrepreneurial learning and a greater degree of alertness to new business opportunities. We discuss these findings and provide avenues for extending this emerging area of scholarly research

Business ownership experience, entrepreneurial behaviour and performance: novice, habitual, serial and portfolio entrepreneurs

Recent media reports have drawn attention to entrepreneurs who have successfully owned several businesses. Entrepreneurs who have owned at least two businesses are known as 'habitual entrepreneurs'. However, not all habitual entrepreneurs are consistently successful. Further, studies show that habitual entrepreneurs are heterogeneous. A distinction has been made between portfolio entrepreneurs (i.e., those who own multiple businesses simultaneously) and serial entrepreneurs (i.e., those who have owned multiple businesses sequentially). It has been argued that to really understand entrepreneurship, there is a need to understand habitual entrepreneurs because they have been able to move down the experience curve with respect to the problems and processes of owning a business. If habitual entrepreneurs are distinct from other groups of entrepreneurs such as novice entrepreneurs (particularly in terms of superior performance), then there may be advantages associated with identifying their practices. Practitioners, such as providers of finance, can make sure that the qualities of habitual entrepreneurs are present in the entrepreneurs they choose to find. Policy-makers wanting to maximise the return on their investments may provide financial support to this group. In addition, guided by the knowledge of how habitual entrepreneurs behave, support can be directed to novice entrepreneurs to encourage best practice. In this study, the theoretical rationale for distinguishing between these groups is provided using human capital theory. Business ownership experience is viewed as one component of an entrepreneur's specific human capital. In particular, it is argued that as a result of their experience, habitual entrepreneurs may have had an opportunity to develop other aspects of their human capital to a greater extent than novice entrepreneurs. Consequently, one objective of the thesis was to identify differences in the human capital profile of habitual and novice entrepreneurs. The results of the study show that while similarities exist, habitual entrepreneurs display different human capital characteristics than novice entrepreneurs. Further, portfolio entrepreneurs also display different human capital characteristics than serial entrepreneurs. The thesis also explored the relationship between business ownership experience and entrepreneurial behaviour as well as performance. The evidence indicates that habitual entrepreneurs do not search for more information than novice entrepreneurs but they do use different sources of information. Further, habitual entrepreneurs (in particular portfolio entrepreneurs) identify and pursue a significantly greater number of opportunities in a given period. Using a variety of entrepreneur and firm-level performance measures, habitual entrepreneurs do not out-perform their novice counterparts. Interestingly, neither those habitual entrepreneur-s who had been consistently successful, nor those who had previously failed, report superior performance to novice entrepreneurs. On the basis of the findings presented in this study, a number of policy suggestions can be made. Unfortunately, as no particular group of entrepreneur was associated with superior performance, the recommendation than financial support be targeted to a certain group could not be made. However, given relationships between other aspects of human capital and performance, some suggestions for support, particularly in terms of training are offered. Given identified differences in the human capital and behavioural profile of novice, habitual, serial and portfolio entrepreneurs, a case for tailored support is made

The evolution of founder identity as an authenticity work process

Research has shown founders' identities have a significant impact on their ventures. Yet, the process through which founder identity evolves and takes shape remains relatively unexplained. This paper explores the evolution of founder identity through a qualitative study of first-time sustainable entrepreneurs, and their stakeholders, over a three years period. Our analysis revealed the importance of personal identity, the aspect of the self that defines a person as a unique individual based largely on values and beliefs. We found that first-time founders sought to align their personal identity with their evolving founder identity over time. Based on these findings we theorize a process model of founder authenticity work, defined as the activities founders engage in to feel and seem authentic while engaged in entrepreneurial action. This study thus details the significance of personal identity as a guidepost for founder identity evolution, complementing extant founder identity studies focused on role and social identities. In addition, our analysis enriches the current conceptualization of authenticity in entrepreneurship research by linking it to validation of personal identity and highlighting its negotiated nature in the evolution of authentic founder identities

Balancing “what matters to me” with “what matters to them”: exploring the legitimation process of environmental entrepreneurs

We extend current knowledge on new venture legitimation by focusing on how environmental entrepreneurs enact their values and beliefs during the legitimation process and on the resultant business and personal consequences. On the basis of our longitudinal analysis of six cases studies we develop a staged process model of legitimation. Our findings suggest three novel insights. First, the entrepreneur’s (i.e. the legitimacy seeker’s) own values and beliefs are found to anchor initial decisions about how to gain legitimacy (the “what matters to me” stage) but are then toned down as attention shifts to gain legitimacy from diverse audiences (the “what matters to them” stage). Eventually, the entrepreneurs arrive at an approach that balances “what matters to me and them”. Second, we are able to explain how and why these changes in legitimation take place. The entrepreneurs learned to adapt their legitimation work by engaging in reflection and reflexivity about both the business and personal consequences of their work in each stage. Finally, we detail the significance of dissonance to this process as a trigger for changes in behavior. Overall, our three insights allow us to extend the notion of what a skillful legitimacy seeker might be

Breaking boundaries to creatively generate value : the role of resourcefulness in entrepreneurship

Entrepreneurial resourcefulness is a concept that resonates with practitioners and scholars alike from a diverse set of theoretical and empirical backgrounds. Despite the prevalence and promise of this concept, the literature on entrepreneurial resourcefulness is fragmented and lacks cohesion in how it is labeled, conceptualized, measured, and deployed. In many cases, it appears that bringing resources to bear for entrepreneurial purposes is taken for granted, which limits theoretical development of if and how ventures emerge and grow. In this editorial, we explore the theoretical underpinnings of resourcefulness, offer a definition, and provide a roadmap for future scholarship. In addition, we introduce the six articles that comprise the Special Issue on entrepreneurial resourcefulness, discuss their contributions, and explore how they relate to our overall perspective on resources and resourcefulness. It is our hope that this Special Issue will mobilize additional scholarship to enhance our knowledge on resourcefulness, which we view as a fundamental part of entrepreneurship