Effects of parental entrepreneurial performance on the mode of entrepreneurial entry by the next-generation family members: evidence from an emerging economy

PurposeThe purpose of the paper is to examine the effects of perceived parental entrepreneurial rewards, or PPERs (i.e. the offspring's perception of the degree of parental success in entrepreneurship), on the corporate venturing (CV) mode of entrepreneurial entry and the interaction effects of family business involvement (FBI) and formal employment on the association between PPER and CV by the next-generation family members.Design/methodology/approachA survey was administered to a sample of 738 small business owners in Kenya; of which, 440 small business owners were selected because they grew up in a family business context. A probit model was used to examine the main and interaction effects.FindingsPPERs significantly influenced CV. FBI improves the positive relationship whereas formal employment reduces the effects of PPER on CV.Practical implicationsFamilies in business need to improve conversations with their children to include discussions concerning the intrinsic and extrinsic rewards of running a family business, which may shape not only the entrepreneurial entry path of their offspring but also the willingness to establish businesses that may grow and lead to continuity of the family business of origin.Originality/valueThe study investigates the effect of being embedded in a business family in shaping the CV mode of entrepreneurial entry by the next-generation family members who may not, on the one hand, find independent own founding an attractive option and for whom, on the other hand, the succession mode of entry may not be an option.

Staged entrepreneurship: the formation of hybrid and spawning entrepreneurial intentions

Most individuals find their way into entrepreneurship through combinations of self-employment and paid employment. However, prior research on entrepreneurial intentions has overlooked intended career transitions. Drawing on social cognitive career theory, we argue that, against the background of personal and environmental factors, individuals form career intentions that involve the combination of and transition between paid employment and self-employment. Such staged entrepreneurial intentions include the delay of entrepreneurial entry by intermediate stages of paid employment (i.e., spawning entrepreneurial intentions) or immediate entrepreneurial entry in parallel combination with paid employment at established organizations (i.e., hybrid entrepreneurial intentions). We test these theoretical ideas based on a survey involving 1003 individuals prior to career entry. The results indicate that individuals proactively align their envisioned career stages according to expected socio-cognitive enablers and barriers (i.e., their entrepreneurial self-efficacy, personal attitudes to entrepreneurship, subjective norms, and socioeconomic status). Notably, we find that individuals with lower levels of perceived social support for an entrepreneurial career more likely intend to combine their existing entrepreneurial activities with a conventional career at an established organization. Furthermore, individuals from lower socioeconomic status backgrounds as well as women are more likely to delay entrepreneurial entry by starting their professional careers in paid employment. The study’s primary contribution is the introduction of a novel perspective on entrepreneurial intentions based on individuals’ intended career transitions.

The Impact of Cultural Capital on Development of Entrepreneurship in Wales

The focus of this paper is the impact of parental cultural capital on offspring’s occupational choice in relation to entrepreneurship. Despite growing interest to cultural motives for entrepreneurship on an individual level, few studies link these two domains empirically. This study follows the Culture Based Development research paradigm (CBD) developed by Tubadji and explores how culture influences occupational choices of school graduates during school-to-work transition. The main hypothesis of this paper is that sons of entrepreneurs are more likely to choose transitions into entrepreneurship after graduating school. I test three hypotheses on a unique historic dataset from Wales, UK, employing Probit analysis. I found a significant correlation between entrepreneurial background of father and son’s entrepreneurial entry. Poor socio-economic status of a father is also a predictor of entry into entrepreneurship of their son, motivated by necessity. The findings of this research contributed to the applicability of CBD to a historic dataset of earlier periods to capture a significant cultural impact on entrepreneurship development in Wales, UK.

Entrepreneurship Without Innovation Is Unsustainable

Entrepreneurship has some element of innovation to begin with; however, the meeting of the market gap demands innovative gesture allowing for the vibrance of entrepreneurial entry into the market. Even though the essential market entry is influenced by creative propositions, it has in recent times become subjected to the question of if it is not sustained by innovation, will it cease to be competitive? This chapter will focus on the understanding of entrepreneurship and its benefits, innovation and its benefits, as well as relevant theories to the subject.

Incumbent Stakeholder Management Performance and New Entry

Instrumental stakeholder theory seeks to explain how managing stakeholders effectively can yield competitive advantage for incumbent firms. We extend instrumental stakeholder theory to explain and predict future competition operationalized as new entrepreneurial entries. Our study is among the first to empirically examine the relationships between aggregate stakeholder management performance and the entrepreneurial entries of individuals. Using a combined U.S. dataset from 2003 to 2013 from the Kinder, Lydenberg and Domini (KLD) Index, Compustat, and Kauffman’s Entrepreneurship Survey, we find support for three hypotheses. First, higher levels of stakeholder management performance are related to lower rates of entrepreneurial entry. Second, a curvilinear relationship exists between stakeholder management performance and entrepreneurial entry, where both low and very high stakeholder management performance increase entrepreneurial entry. Third, the greater the variance in stakeholder management performance across stakeholders, the more entrepreneurial entry. Our findings suggest that managing for stakeholders can help to avoid future competition. We add an entrepreneurship lens to the business ethics of stakeholder theory showing how incumbent stakeholder management performance shapes opportunities for entrepreneurs, a largely neglected stakeholder group.

Do You Need to be Risk-Tolerant to Become an Entrepreneur? The Importance of the Reference Point

The creation of new ventures involves a great deal of risk and uncertainty. However, research has been theoretically divergent and empirically inconclusive about the influence of individuals’ risk tolerance on entrepreneurial entry. In this paper, we argue that this relationship is contingent on the reference point of individuals, taking into account the human capital and the opportunity cost of individuals when they decide to start a venture. This approach allows us to clarify some of the previous mixed results in the literature. We use a sample of almost 600,000 individuals from 90 countries that have participated in the Global Entrepreneurship Monitor project between 2010 and 2014. Our results show that individuals with previous experience as entrepreneurs do not need to be so risk-tolerant to set up their own venture, while individuals with a job and/or a high educational level need to be especially risk-tolerant to become entrepreneurs.