The sustainable start-up paradox: Predicting the business and climate performance of start-ups

Sustainable start-ups introduce new sustainable technologies and business models that facilitate the transition to a carbon neutral economy. To understand how to create viable sustainable start-ups, we study what factors predict their business performance and climate performance (i.e., the ability of the start-up to reduce CO₂ equivalent [CO₂e] emissions) and if these contradict. A critical factor we consider is technology, which is commonly at the root of climate performance, and important for business performance because it influences a start-up's competitive advantage. Using a sample of 197 sustainable start-ups, we find a paradox between business and potential climate performance. Start-ups that exploit hardware technologies have a lower business performance but a higher potential climate performance. Through the use of mediating effects, we show that the sustainable start-up paradox is context specific. Start-ups can partly escape this paradox by focusing on novel and hardware technologies. We discuss implications for theory and practice.     

Motivations for enterprise system adoption in transition economies: insights from Poland

Enterprise system (ES) adoption can bring many benefits, but may also put tremendous strain on an organisation or business, sometimes with disastrous outcomes. The specific motivations and expectations that lead to ES adoption may impact the success or failure of these endeavours, and understanding these motivations may be useful in predicting the success of ES projects. Most of the published research on ES adoption motivation has been in the context of highly developed countries. The social, cultural, economic and political conditions in developing, emerging and transition economies make for a different business environment, and insights obtained from developed countries may not always transfer to these settings. This study seeks to identify and help understand the motivations for ES adoption specifically in transition economies, as these economies play a significant role in the global market, but have not been receiving adequate research attention. Drawing on the experience of 129 ES adopters in Poland, a transition economy, this study categorises motivations into coherent groups of issues and evaluates the influence of discovered motivations on ES adoption success. Further, motivations revealed by this study are compared with motivations reported by prior research conducted in developed countries.     

Reciprocated community support and small town - small business success

This paper presents an empirical test of the significance of reciprocated community support, in contrast with traditional economic factors and unilateral support, in the success of small businesses in small towns. The central hypothesis is that entrepreneurs who make non-market contributions to their community and whose community supports them, are more likely to consider their businesses to be successful. Logistic regression is used to analyse survey data from over 800 small businesses in 30 small towns of the state of Iowa (USA). The authors found that the interaction effect of an entrepreneur's service to the community, reciprocated by community support of the business, is the single most significant determinant of business success among dozens of indicators and characteristics of the respondent, the business, and the small towns in the sample. In addition, it was found that business people who feel successful expect to expand. These findings are relevant to rural development. The expansion of existing businesses is an important component of regional job growth.     

Exploring the benefits of contact centre offshoring: a study of trends and practices for the Australian business sector

A globalised knowledge economy has seen organisations restructure their delivery of customer services to take advantage of an open and competitive labour market. Gains achieved in developed economies such as the USA and UK from offshoring of business processes to developing countries are pressuring Australian businesses to offshore. This paper explores the practices of Australian businesses with offshore contact centres and considers emerging trends in offshoring in terms of potential risks and benefits for Australian organisations with broad customer contact. Findings suggest that Australian organisations are not only cautiously adopting offshore contact centre solutions to a range of onshore challenges including recruitment and retention of local staff and comparatively high local costs, but also achieving gains beyond cost savings in quality of service and enhanced business flexibility.     

THE CZECH REPUBLIC: PROGRESS TOWARDS FREEDOM AND A MARKET ECONOMY

The Czech Republic has made good progress towards a market economy, though its experience shows that it is easier to change the political system than the economic system. It shows also that public expectations tend to be too high: economic transformation cannot be costless and rapid as is often assumed. The Czech Republic wishes to participate in European integration though it has reservations about the degree of regulation, harmonisation and bureaucratisation in the EU.     

For the greater good: business networks and business social responsibility to communities

Business networks (co-operative arrangements between independent business organizations) may be the signature organizational form of the contemporary global economy. Many policy-makers and local leaders advocate business network membership as an alternative development strategy for regional economic vitality. The extant literature on business networks has focused on their association with business success. However, little is known about their impact on other aspects of community life. The purpose of this paper is to elaborate the role of network membership on one non-economic dimension of the business community interface. We examined the relationship between business network membership and business social responsibility to communities, defined as the provision of leadership and support for community betterment projects. Data were gathered from telephone interviews with a random sample of 460 non-metro small business operators in the USA. Independent t-tests and ordinary least squares regression analyses controlling for theoretically important variables were conducted. Findings show that networked businesses provide more leadership and support for their communities than non-networked businesses. However, networked businesses were no more likely than non-networked businesses to use local suppliers of goods and services.     

Network brokers or hit makers? Analyzing the influence of incubation on start-up investments

Incubators are a prominent way to support technology based start-ups. Yet, it remains unclear to what extent these incubators enhance start-up performance, nor is it known through which mechanisms this would occur. In this paper we test two mechanisms to explain the relationship between incubation and the amount of investments raised by early stage start-ups as performance measure. The ‘hit maker’ mechanism refers to beneficial effects of the direct transfer of resources and organizational or business knowledge from the incubator to the start-up. The ‘network broker’ mechanism refers to the benefits that start-ups enjoy from being connected to external funding sources through the incubator’s networks. We test which of these mechanisms contribute to the performance of early stage start-ups. Our data comes from a unique survey from 935 entrepreneurs with early-stage technology based start-ups in Western Europe and North America. We find that incubators have a positive effect on (1) the amount of funding that start-ups attract and (2) the ability of start-ups to attract funding from formal investors and banks. Moreover, our results provide evidence for the network broker mechanism, but not for the hit maker mechanism.     

基于财务分析的美国五大投资银行风险实证研究

证券市场IPO重启、创业板开市为中国资本市场注入新的活力,与此同时,创设权证、回购以及集合理财等新兴业务为中国证券公司提供了广阔的业务发展空间.然而次贷危机引发的全球金融危机使美国五大投资银行遭受巨大冲击,五大投行也因此最终走向破产或转型.本文从美国五大投资银行的财务报表出发,深入分析次贷危机爆发前后五大投行的业务结构和收入来源变化,从而揭示五大投行在危机中纷纷崩溃的原因,以此为中国资本市场特别是证券公司的稳健运营和发展提供有益的经验借鉴.     

Entrepreneurial branding: measuring consumer preferences through choice-based conjoint analysis

Start-ups face branding challenges. Not only are they confronted with the task of building brands from scratch, their newness also leads to a particularly high amount of customer uncertainty. This paper contributes to the emerging field of entrepreneurial branding by investigating start-up characteristics that signal trustworthy information to potential customers. An extended choice-based conjoint approach for modeling brand equity is used to explore the impact of different signals as initiated by established and new firms in the field of tablet computers. An empirical study reveals brand signals that have significant effects on purchase probabilities and are appropriate to overcome information asymmetries between start-ups and prospective customers.     

Propensity to firm creation: empirical research using structural equations

The identification of the entrepreneurs’ characteristics and the knowledge of the entrepreneurial profile of university students have been assuming a growing importance in the development of educational programs directed towards the entrepreneurship and start-up processes. This study aims to identify the factors that most contribute for the intention to start up a business. The research also tries to identify the profile of a potential entrepreneur student concerning several characteristics: personal attributes, family, demographic variables and motivations. Research findings include the idea that entrepreneurship education is the most relevant factor in what concerns the propensity to business creation. On the other side, personal characteristics have an important role in shaping motivation to start-up a business and perceived hurdles have a negative impact in the intention to start-up. The results may be relevant when developing an adequate educational program directed to the entrepreneurship education and start-up processes.     

The Value Relevance of Financial Accounting Information in a Transition Economy: The Case of the Czech Republic

ABSTRACT

The paper investigates the value relevance of accounting information in the Czech Republic in 1994–2001. Value relevance is understood as the ability of financial statement information to capture or summarise information that affects share values and empirically tested as a statistical association between market values and accounting values. The objective of the study is to investigate the validity of the value relevance methodology by finding an accounting setting where the results of value relevance tests might be predicted unambiguously. If the results of these tests confirm the predicted results, the validity of the value relevance methodology might be assumed. A transition economy represented by the Czech Republic provides such an institutional and accounting setting. It might be assumed that value relevance of accounting information is lower in a transitional economy than in a well-developed market economy. It can also be assumed that the value relevance increases over time as a result of the progress in transition. The results of the study confirm these predicted results and give thus supportive evidence of the validity of the value relevance methodology.     

The determinants of venture creation time: a cross-country perspective

The purpose of this paper is to examine the impact of macro-institutional and macro-non-institutional factors on the new venture creation time across emerging as well as developed economies in Europe using panel data from 2003 to 2006 in 15 emerging and developed countries. This paper finds significant relationships between the venture start-up time and institutional factors that include lending interest rates, start-up procedures, and taxation and one non-institutional factor, GDP per capita. Additionally, we found differences in the factors between emerging and developed countries. Institutional factors, such as start-up procedures and trade opportunities, are important determinants of new venture creation time in emerging countries, consistent with the findings of recent studies. To encourage business formation, policy makers may need to revise policies concerning these factors which can facilitate or restrict new venture formation. Implications for further research and practice are discussed.     

Purchasing Power Parity in Three Transition Economies

This paper uses cointegration analysis on monthly data over April 1994-December 2000 to test the relevance theory of Purchasing Power Parity (PPP) for two advanced transition economies (Poland and the Czech Republic) and one lagging transition economy (Romania). PPP is not rejected between the lagging reformer and developed market economies, but is rejected between the advanced reformers and the developed economies. However, PPP is not rejected between the two advanced transition economies, though it is rejected between the lagging and advanced transition economies. The evolution of the real exchange rates over 1994-2000 suggest that a significant explanation for these findings is the central role of the exchange rate in the disinflation strategies of Poland and the Czech Republic in the early part of this period, in contrast to the managed float followed by Romania throughout the period.     

The structural,social, and strategic factors associated with successful business networks

Business networks, formal arrangements between independent businesses established to enhance member success, are generally accepted as an important strategy to help small businesses survive and prosper, and to promote regional economic development. However, knowledge about what contributes to the success of business networks themselves is less extensive and based primarily on case studies or reports of network directors. The purpose of this paper is to partially address this shortcoming. We consider the structural and social features identified in previous studies as likely correlates of business network success. Using a social constructionist definition of network success, we distinguish successful from less successful networks from among a sample of 29 industry and community business networks in the USA. Findings from interviews with 1122 members and 29 network leaders suggest that trust is central to understanding network success. Structural features have complex positive and negative indirect effects on success through trust and resource exchanges. The findings highlight the fact that business networks, while offering great potential as a way to enhance economic vitality of regions and industries, cannot be viewed as a simple remedy.     

Book review of Economic Geography of Higher Education: Knowledge Infrastructure and Learning Regions. Edited by ROEL RUTTEN,FRANS BOEKEMA and ELSA KUIJPERS (London: Routledge, 2003). [Pp. 258]

This paper focuses on the growing aspect of entrepreneurship associated with lifestyle-induced migration from wealthy countries, through investigating self-employment among expatriates from northern Europe in rural areas of southern France and Spain. Most expatriates had no prior experience of entrepreneurship and typically established their business opportunistically and some time after arrival. Based upon interviews with 41 expatriate households (operating 70 business ventures), the study explores the characteristics of the individuals involved, the nature of their businesses, factors influencing start-up, and processes and patterns of business development. Self-employment is shown to be the most effective available mechanism for supporting lifestyle objectives of expatriates who vary greatly in their skills, experience and resources. The study identifies significant differences between the respective groups from the two countries, reflecting the spatially differentiated character of migration in terms of age, education, qualifications and capital resources. These appear to have given rise to a more sophisticated profile of businesses in the French areas. Sharp differences in language skills as between the different countries are seen as influencing the ability of entrepreneurs to network with, and market to, the indigenous population, with implications for the future development of the businesses, and their local impact. The study seeks to augment standard conceptual approaches to entrepreneurship, through taking account of the primacy of the migration decision and specific related processes, and proposes a model that advances our understanding of the phenomenon.     

Entrepreneurs’ networks and the success of start-ups

The network success hypothesis assumes a positive relation between the networking activities of founders and their start-up’s success. The rationale behind this hypothesis is the theory of socially embedded ties that allow entrepreneurs to get resources cheaper than they could be obtained on markets and to secure resources that would not be available on markets at all, e.g. reputation, customer contacts, etc.

This paper clarifies how entrepreneurial network activities can be measured and which indicators exist to quantify start-up success. It then reviews empirical studies on the network success hypothesis. The studies have rarely come up with significant results. This surprising evidence can be explained by large differences in the way that the dependent and the independent variables were defined and by effects of unobserved variables such as the networking expertise of the founders and the entrepreneurs’ level of existing know-how in the areas of co-operation and networking (‘absorptive capacity’). The major shortcomings of existing network studies are found to be the neglect of different starting conditions, the focus on individual founders’ networks instead of multiple networks in start-ups with an entrepreneurial team, and the assumption of a linear causal relation between networking and start-up success. Accordingly, the paper develops a new, extended model for the relation between entrepreneurial networks and start-up success. Finally, we make some suggestions for the further development of entrepreneurial network theory.     

Business creation by immigrant entrepreneurs in the valencian community. The influence of education

The authors analyse the level of education and the attitude to education of immigrant entrepreneurs in relation to enterprise activity, the reasons for setting up businesses and the creation process. The main objective of this article is to discover the most important characteristics of immigrant entrepreneurs in the Valencian Community. In particular, it attempts to explain the influence of education on the setting up of businesses. To do so, 326 questionnaires have been analysed to undertake a study of the various immigrant communities in the Valencian Community that identify said factors. The hypothesis we put forward in this article is an attempt at relating the attitude to education of immigrant entrepreneurs, and its relation to business activity, the motivation for setting up businesses and the process for said business creation. As the most outstanding result, this article shows that the level of education of an entrepreneur is the factor on which the majority of business activity will depend. There is no factor of this personal dimension that relates to most aspects of motivation and business process. The study focuses on a particular geographical area. Consequently, the study helps to understand business activity by non-national entrepreneurs in a globalized economy and adds value to public policies for fostering business.     

The influence of perceived management skills and perceived gender discrimination in launch decisions by women entrepreneurs

Our study answers the call for a better understanding of female entrepreneurs in Morocco and the role families play in launch decisions. The purpose of this paper is to analyze the influence of perceived management skills and perceived gender discrimination in obtaining funds on women entrepreneurs’ propensity to start their businesses with or without family members. Drawing upon the family embeddedness and institutional economics theoretical frameworks, perceived high management capabilities are found to increase the likelihood that a female entrepreneur will set up her business with family members. However, when the entrepreneur perceives gender discrimination in obtaining funds, this will negatively moderate this relationship and will make it more likely that a woman will start her business alone or with nonrelatives. This research contributes to the literature by advancing knowledge of the socio-cultural factors, embedded in the family-oriented contextual framework, that affect women entrepreneurs’ ways of starting their businesses. Implications affecting the success of women-owned start-up businesses and public policy implications are discussed.     

The influence of entrepreneurs’ social referents on start-up size

This paper uses social comparison theory to explore the effect that the average size of established businesses at the regional (provincial) level may have on start-up size. It is argued that established entrepreneurs at the regional level become referents of new entrepreneurs, influencing not only the decision to become entrepreneurs but also the characteristics of the new venture, such as its initial size. Specifically, the greater the average size of established businesses at the provincial level, the bigger the start-up size of new ventures. This paper further considers how this effect is moderated by two key individual level variables: knowing an entrepreneur personally (i.e., close social referent), and being the owner and manager of an existing business (i.e., past entrepreneurial and managerial experience). Predictions are tested using data that combine individual- and provincial-level information in Spain over the period 2008–2014. The results show the positive relationship of the average size of established businesses on new venture start-up size, and that this effect decreases when the entrepreneurs have previous entrepreneurial experience.     

Staatliche Gründungsfinanzierung: Stand der Forschung und offene Fragen

This paper provides a survey on the current status of research in the field of public entrepreneurial financing. Most importantly, we investigate the economic justification of public activities in the market for start-up financing by addressing four research questions. First, the paper evaluates whether start-ups support macroeconomic growth at all. Second, we look for evidence of imperfections and market failure in the market for entrepreneurial finance. Third, the paper investigates whether public financing of start-ups is effective in the sense that subsidized firms perform better than non-subsidized ones. Fourth, it needs to be analyzed if existing measures of public financial support for start-ups are efficient, i.e. reach their economic goals cheaper than other measures. The answers to these questions are mostly negative which shows that economic research has no justification to offer for public entrepreneurial financing.