Determinants of satisfaction for entrepreneurs

This study considers the extent to which entrepreneurs are satisfied with their businesses in their third year of business ownership. Entrepreneurial satisfaction might be viewed as a basic measure of performance. It may bear upon decisions by individual entrepreneurs about whether to invest more time and money, whether to cut back, or whether to close down. It may also influence whether entrepreneurs work effectively with their customers and employees. For researchers, the investigation of why, in particular settings, some entrepreneurs may be more satisfied than others may aid in the interpretation of past research, which has used this as a performance measure.This research draws upon a theoretical framework used in investigations of employee satisfaction. Called discrepancy theory, it suggests that individual satisfaction is determined, in part, by whether there is a “gap” between actual rewards or performance and the individual's goals or expectations.In this research, it was hypothesized that entrepreneurs emphasizing primarily noneconomic goals (such as doing the work they wanted to do) would have higher satisfaction when the business was experiencing lower levels of performance. For higher levels of performance, there would be no difference. In essence, the satisfaction of those emphasizing economic goals would vary more with economic performance. A related hypothesis was that, for this sample of start-up firms (many of which would be experiencing low levels of performance), those emphasizing noneconomic goals would have higher average levels of satisfaction. This was based upon the expectation that many start-up firms would be experiencing marginal performance, so that the “gap” between goals and performance would be greater for economically oriented entrepreneurs. The research also focused upon expectations, because one aspect of discrepancy theory suggests that satisfaction decreases if there is a gap between expectations and performance. Accordingly, it was hypothesized that, controlling for performance, entrepreneurs with higher initial expectations would subsequently have lower levels of satisfaction. Previous research suggests that membership in particular demographic groups may influence expectations. This led to hypotheses that older entrepreneurs, female entrepreneurs, and minority entrepreneurs would have lower levels of initial expectations. This, in turn, may influence later satisfaction. Thus, it was hypothesized that, controlling for performance, entrepreneurs in each of these groups would have higher satisfaction because their initial expectations would be lower. The study utilized a sample of 287 entrepreneurs who were followed over a 3-year period. The data on predictors of satisfaction were gathered in year 1, when the average owner had been in business for 11 months. The satisfaction measures were gathered 2 years later. By that time there should have been some stabilization in the routines of the business, and the entrepreneur could reflect upon historic performance and experiences in judging the extent to which business ownership had been satisfying. The data were analyzed primarily using path analysis, in which it was hypothesized that certain variables would have both direct and indirect effects upon satisfaction.It was found that the satisfaction of entrepreneurs emphasizing economic goals was not more sensitive to economic performance, at least within the range of performance considered in this sample. For this group of firms, many of which appeared to be experiencing marginal performance, those emphasizing noneconomic goals did express higher levels of satisfaction. It had been expected that those with higher initial expectations would later be less satisfied because they would have a greater expectation-performance gap. However, the opposite was found; those who were more optimistic initially were more satisfied later, even when controlling for performance. Demographic influences on initial expectations were examined. Contrary to expectations, none of the demographic traits was significantly related to initial assessment of likelihood of success. Older entrepreneurs, women entrepreneurs, and minority entrepreneurs were just as optimistic as those in other groups. The relationship between membership in these demographic groups and later satisfaction was also examined. No significant relationships were found for older entrepreneurs and minority entrepreneurs. However, there was some evidence (p = .07) that women entrepreneurs were more satisfied with business ownership.Two of the most interesting findings were those related to initial expectations and to women entrepreneurs. Contrary to discrepancy theory, those who had higher initial expectations were later more satisfied, not less. This may suggest, as Staw and Ross (1985) found in a longitudinal study of employee satisfaction, that attitudes are, in part, a function of stable individual traits. Those who had a positive view of their initial prospects later viewed the experience of business ownership more favorably, regardless of subsequent performance. For women entrepreneurs, the higher levels of satisfaction may reflect a view that they have fewer attractive alternatives; it may also be that they discover greater relative satisfaction from the day-to-day aspects of business ownership.For entrepreneurs and their advisors, the findings suggest that particular goals, attitudes, and backgrounds are likely to be associated with greater satisfaction. This may influence whether entrepreneurs stay with marginal businesses. For researchers, the study provides insight into discrepancy theory by considering its application to entrepreneurs rather than the hired employees normally studied. In addition, subjective measures of performance, such as satisfaction, have often been used in previous research on entrepreneurial performance. This study casts light on why, in particular settings, some entrepreneurs may be more satisfied than others.     

The urban growth potential of second-generation migrant entrepreneurs: A sectoral study on Amsterdam

A rise in second-generation migrant entrepreneurs and an increasing focus on modern economic sectors have become new trends in migrant entrepreneurship in recent years. Although traditional sectors are still the most popular among the first-generation migrant entrepreneurs, because of the increasing pressure and their high competitiveness in traditional areas, nowadays new market niches are rapidly developing. While the first generation has more often become active in new areas such as the producer services sector which includes finance, insurance, real estate and business-related professional services, the second generation has contributed to the emergence of new areas of immigrant business activity such as the ICT sector and the creative industries.Against this background, this study focuses on the external orientations of the second-generation migrant entrepreneurs by addressing in particular the way – and the extent to which – the choice for entrepreneurship is made by higher-educated young ethnic generations. This is a new field of entrepreneurship research in many European countries. The empirical data of our study is based on in-depth personal interviews held in the first half of 2007. We employed a recently developed multivariate qualitative classification method, coined rough set analysis, in order to investigate the motivation, goals and strategies of second generation Turkish entrepreneurs in the ICT and the financial services sector in the Netherlands.The results of our study show that the second generation Turkish entrepreneurs in the Netherlands have started to be involved in new and non-traditional sectors like ICT and financial services sectors. The motivation and driving forces of the second-generation Turkish entrepreneurs are stemming from both their personal characteristics shaped by their higher educational level and their previous working experience as an employee or entrepreneur in the same sector. The demand for and a gap in the sector as well as the growing and promising structure of the sector play also an important role in pulling the second generation Turkish immigrants to become entrepreneur in these new sectors.     

Ethics and entrepreneurs: An international comparative study

In this study, we develop a conceptual framework for the examination of cross-cultural differences in ethical attitudes of business people based on the assumptions of integrative social contract theory (ISCT). ISCT reveals the relevant cultural and economic norms that are predictive of the level of the ethical attitudes among societies and at the same time points out the more subtle impact of social institutions on ethical attitudes of different groups within a society. The evidence supports the use of integrative theoretical approaches within the field of business ethics.     

Manufacturing entrepreneurs: An empirical study of the correlates of employment growth in the Tulsa MSA and rural East Texas

Manufacturing firms and firms totally dependent on manufacturing provide more than 50% of the jobs in the United States and other industrialized nations. In spite of the belief that the United States has become an “information economy,” it has recently been recognized by researchers, politicians and industry experts that the loss of America's leadership position in manufacturing threatens the American industrial position. In addition, small firms provided most of the job growth in the decade of the 80s and the most innovation and new products.The impact of these factors indicates the importance of determining what it takes to be successful as a manufacturing entrepreneur. Beyond the importance to the national economy of understanding the success-related factors in manufacturing entrepreneurship, several stakeholder categories have a vested interest in this information as well. Job creation, job growth and economic development become major agenda items in the 1992 presidential campaign. Also, investors would like to have a model of small firm growth on which to base their investments in start-up firms. Finally, political units are looking for mechanisms to create much-needed new jobs to provide tax revenue.The purpose of this study was to: (1) determine the relationship between eight literature-based predictor variables and employment growth in entrepreneurial manufacturing firms and (2) attempt to develop a meaningful linear model, incorporating as many significant variables as possible from the original eight that would explain variance in firm performance.The focus of this study was 327 manufacturing entrepreneurs located in the Tulsa Metropolitan Statistical Area and 13 contiguous counties in East Texas. Manufacturing entrepreneurs were defined as the founders of their firms. The firms included in the study were all less than ten years old, independent (not a division of some other firm) and had primary SIC codes between 2000 and 3999. Usable responses to a mail survey were 103, a 31.5% response rate.Results of this study suggest that age (of the entrepreneur) at founding, entrepreneurial management experience, industry experience and environmental scanning practices are significantly correlated with firm performance as measured by employment growth.     

An exploratory study of characteristics and attributes of Turkish entrepreneurs: A cross-country comparison to Irish entrepreneurs

There has been limited research on entrepreneurship in Turkey. Given the fact that globalization has rapidly been increasing, that foreign direct investment is spreading throughout the world, and that more and more foreign investors are seeking partners in emergent markets such as Turkey. One important reason for the interest in Turkish entrepreneurs is because they have many characteristics that are similar to entrepreneurs in Western markets. Even if there are many differences between Western entrepreneurs and Turkish entrepreneurs, it would be valuable to compare the characteristics of Turkish entrepreneurs with others. Moreover, a few cross-cultural studies have examined the similarities among entrepreneurs in various nations. Ireland and Turkey have many striking similarities despite varying cultural backgrounds. Hence, this empirical research was undertaken to investigate the characteristics and attributes of Turkish entrepreneurs and compare them to Irish entrepreneurs. The research design in this study focused on 161 Turkish entrepreneurs who were randomly selected from a list (obtained from local Chamber of Commerce) and interviewed using a structured questionnaire. The questions assessed relevant areas, such as demographic and business information, motivations, entrepreneurial characteristics, business problems, personality characteristics, and management skills. Information on the Irish entrepreneurs was incorporated from a published study. Overall, in terms of entrepreneurial characteristics, Turkish entrepreneurs displayed surprisingly similar characteristics to the Irish. The implications of this study are discussed along with some recommendations.     

Deciding to export: An exploratory study of Singaporean entrepreneurs

This paper confirms a mapping between a taxonomy of entrepreneurs and what triggered Singaporeans to become exporters. The study involved interviews with 47 new exporters based in Singapore. Entrepreneurs were classified as either ‘opportunity seeking’ or ‘reactive’. Export triggers were either ‘pull’, negative ‘push’, or positive ‘push’. We find that those who were opportunity seeking at start-up were more likely to have responded to export ‘pull’ forces. It was rare indeed for a reactive founder to have been ‘pulled’ into exporting. Among this group of entrepreneurs, ‘push’ forces dominated the decision to export. The paper concludes with some implications for policy targeting and suggestions for further research.     

Innovation and risk-taking in a transitional economy: A comparative study of chinese managers and entrepreneurs

This research was set in the People's Republic of China. As former socialist China moves from central planning toward a more market-driven economy, improved knowledge about the new environment and firm decisions within such an environment has significant implications. For organizational researchers, such a transition represents a genuine shift of paradigm, and thus offers a unique opportunity to test existing organizational theories and develop new ones. For multinational businesses seeking business opportunities, they have to compete or cooperate with these Chinese firms, whether state-owned or privately owned.Motivated by a deep curiosity in, using the language of Williamson (1996), “What is going on there” behind the “bamboo curtain,” and underpinned by a strong conviction that organizational researchers have much to gain as well as to offer by focusing on transitional economies, I undertook this study to examine characteristics of a regulatory environment and the impact on innovation and risk-taking among Chinese managers and entrepreneurs. I collected original primary data that represents managers from large state-owned enterprises (SOEs) and entrepreneurs from small privately-owned enterprises (POEs) through personal interviews and a survey. Significant differences were found between managers and entrepreneurs in their reported environmental characteristics, strategic orientations, size, and firm performance, indicating that managers are not as innovative and are less willing to make risky decisions than entrepreneurs. Being smaller and faster than SOEs, entrepreneurial firms have adopted some strategies that distinguish them from their larger and more established competitors. Speed, stealth, and sound execution allow entrepreneurs to harvest first-mover advantages and thus increase their chances for survival in a turbulent environment.     

The profile of women entrepreneurs: a sample from Turkey

This research was carried out among 220 married women in business in Ankara. Its aim was to determine the profile of women entrepreneurs. A random sampling method was used and data were collected through individual interviews (face‐to‐face). The study examined working status, reasons for being in business and the types of businesses involved. It examined the difficulties experienced in starting up and maintaining the businesses, the risks involved, earnings, the characteristics of the entrepreneurs and future planning. Government rules and regulations were considered, as was the willingness of women entrepreneurs to participate in training programmes. The women’s ages, educational levels and the extent of their business experience were also examined.     

Determinants of required return in venture capital investments: a five-country study

Using two complementary theoretical perspectives, we develop hypotheses regarding the determinants of the return required by venture capitalists and test them on a sample of over 200 venture capital companies (VCCs) located in five countries. Consistent with resource-based theory, we find that early-stage specialists require a significantly higher return than other VCCs when investing in later-stage ventures. Consistent with financial theory, we find that acquisition/buyout specialists require a significantly lower return than other VCCs when investing in expansion companies. Furthermore, in comparison to specialists, highly stage-diversified VCCs require a significantly higher return for early-stage investments. Independent VCCs require a higher rate of return than captive or public VCCs. In general, higher required returns are associated with VCCs who provide more intensity of involvement, have shorter expected holding period of the investment, and being located in the US or UK (in comparison to those in France, Belgium, and The Netherlands).     

Islam and socially responsible business conduct: an empirical study of Dutch entrepreneurs

This paper explores the relationship between the Islamic religion and the level of socially responsible business conduct (SRBC) of Islamic entrepreneurs. The authors find that the common ideas of SRBC correspond with the view of business in Islam, although there are also some notable differences. They also find that Muslim entrepreneurs attach a higher weight to specific elements of SRBC than do non-Muslims. However, they also find that Muslims are less involved with applying SRBC in practice than non-Muslim managers.     

Determinants of the satisfaction of firms with the competencies of university students: a Spanish case study

Spanish universities pay little attention to business demands with regard to workforce training and to the research that has been developed in this area. The present study analyses the effect of various factors on firms’ satisfaction with the education provided by universities. The factors include the content of the student's major subject of study and social, methodological and participation skills. The data were obtained from a survey of businesses. Although the results obtained show that all of the factors have an impact on overall satisfaction, they are not of equal importance. University managers may be able to use the information obtained from this study as a basis for designing and implementing action that might improve employers’ level of satisfaction, which has considerable positive consequences. Moreover, the study's methodology could be applied to other outputs of universities, such as the research performed.     

Predicting bank failures using a hazard model: the Venezuelan banking crisis

This paper uses a proportional-hazard model with time-varying covariates to determine the financial indicators that could have predicted the bank failures during the 1994–1995 Venezuelan banking crisis. A proportional-hazard model is an adequate econometric tool to analyze this case of limited cross-sectional financial information. I find that both a bank's ability to generate sound profits and the support of low risk government bonds were the key to not failing in a crisis that took down more than half of the system. These results can be extended to a general case of bank failures under volatile economic environments.     

From grassroots to international markets: A qualitative study of marginalized entrepreneurs in India

Much of the growing literature on international entrepreneurship focuses on how positive circumstances, such as having prior international experience, business networks, or formal institutions lead to international entrepreneurial action and overlooks the role more challenging circumstances might play. In this study, we extend and refine challenge-based entrepreneurship theory to explore what influences international entrepreneurial action undertaken by marginalized entrepreneurs in an emerging economy. Despite widening economic and social disparities in emerging economies, little is known about entrepreneurs who have traditionally been “left behind.” Our findings suggest that these marginalized entrepreneurs have not only a set of liabilities but also advantages, including creative problem solving and perseverance, as well as local knowledge and networks. To spur the first-person international opportunity belief associated with international entrepreneurial action, an intermediary with resources and networks is needed to offset the liabilities. These intermediaries act as gatekeepers, helping some marginalized entrepreneurs but holding back others.     

Trust,fast and slow: A comparison study of the trust behaviors of entrepreneurs and non-entrepreneurs

Following the cognitive and behavioral approach, this study compares the trust behaviors of entrepreneurs and non-entrepreneurs in a dynamic environment. Due to the differences in the contexts that they face, the thinking frameworks they adopt, and the knowledge structures they form from experience, we argue that entrepreneurs display different trust behaviors from non-entrepreneurs when facing volatile environments in the decision-making process. Adopting established paradigms from behavioral game theory (trust game), we examine the evolution of trust behaviors of the two groups for trust building, trust violation, and trust recovery. In a Singapore-based sample, we find that entrepreneurs build trust more quickly, decrease trust more quickly when faced with trust violations, and recover more quickly from trust violations than non-entrepreneurs. This study contributes to a better understanding of entrepreneurs' trust behaviors over time, their responses to variations in social exchanges, while contributing to overall ongoing discussions of the unique characteristics of entrepreneurs.     

Determinants of ethnic minority entrepreneurial growth in the catering sector

This paper seeks to evaluate the variables which influence the growth of the Turkish-speaking ethnic minority businesses in the catering sector, in London, UK. The paper reports and analyses the findings of 111 face-to-face structured interviews with Turkish Cypriot, Kurdish and Turkish restaurant business owners. Findings suggest that fluency in English, recruitment through formal recruitment channels, and the high proportion of co-ethnic labour force makes a positive impact on business growth. The paper concludes that these determinants of growth are crucial for the ethnic minority catering entrepreneurs to gain a competitive edge in this customer focused, labour intensive sector.     

Nations of entrepreneurs: A social capital perspective

This research examined the effects of social capital on entrepreneurial opportunity perception and weak tie investment using individual-level data from the Global Entrepreneurship Monitor linked with national-level data on social capital. Consistent with a social capital perspective, this study found that a resident of a country with higher generalized trust and breadth of formal organizational memberships was more likely to perceive entrepreneurial opportunities. A resident of a country with higher generalized trust was also more likely to invest in an entrepreneur with whom he or she had a weak personal tie than was a resident of a country with lesser generalized trust.     

The success factors of necessity immigrant entrepreneurs: In search of a model

This study focuses on the success factors of necessity immigrant entrepreneurs. It proposes a profile for the necessity immigrant entrepreneur as well as for the opportunity immigrant entrepreneur. It clarifies the concept of success for immigrant entrepreneurs and suggests that the concept of survival is more appropriate for the necessity immigrant entrepreneurs and should mainly be measured by the age of the business, while the traditional concept of success is relevant for the opportunity immigrant entrepreneur and can be measured by the usual quantitative performance indicators. Based on different existing theories, the study suggests a theoretical explanation of the survival factors of necessity immigrant entrepreneurs. This contributed to propose a theoretical model of survival factors of necessity immigrant entrepreneurs. This model, which represents the major contribution of this study, suggests five categories of survival factors: ethno‐cultural factors, financial factors, managerial factors, psycho‐behavioral factors, and institutional factors. © 2010 Wiley Periodicals, Inc.     

Failing firms and successful entrepreneurs: serial entrepreneurship as a temporal portfolio

Entrepreneurial performance is almost always confounded with firm performance. In this paper we argue for an instrumental view of the firm by formally showing that entrepreneurs can amplify their expected success rates by designing their careers as temporal portfolios that exploit contagion processes embedded in serial entrepreneurship. The advantages to holding concurrent portfolios that exploit heterogeneity are well known. The same advantages may be achieved in the serial context through contagion. Our model exploits an observation due to William Feller on the near equivalence of the two, statistically speaking. It also leads to empirically plausible implications about the size distribution of firms in the economy and illustrates the relevance of considering firms and entrepreneurs as distinct loci of analysis.     

Public knowledge,private knowledge: the intellectual capital of entrepreneurs

This paper focuses on the innovative actions of entrepreneurs, namely their tendency to reveal the intellectual capital that results from their research efforts either in the form of public knowledge (publications) or private knowledge (patents). Using data collected by the National Research Council within the US National Academies from their survey of firm’s that received National Institutes of Health phase II Small Business Innovation Research awards between 1992 and 2001, we find that entrepreneurs with academic backgrounds are more likely to publish their intellectual capital compared with entrepreneurs with business backgrounds, who are more likely to patent their intellectual capital. We also find that, when universities are research partners, their presence complements the tendencies of academic entrepreneurs but does not offset those of business entrepreneurs.