Abstract
Entrepreneurs as the most important drivers, determine the whole enterprise's innovation capabilities in Small and Medium-sized Enterprises (SMEs). Existing literatures concerned the relationship between innovation capabilities and entrepreneurs, consistently emphasize the important role of entrepreneurs; yet they do not clarify the question of “how”—how entrepreneurs leverage the innovation capabilities. However, the answer of “how” has more practical significance than just expounding the important role of entrepreneurs in enhancing innovation capabilities. In this article, two paths by which entrepreneurs leverage innovation capabilities are explored. One is direct; referring that entrepreneur should strengthen himself. The other is a relatively indirect one, nurturing employees to leverage the whole enterprise's innovation capabilities. A case study of the innovation capability development at UPG, a small financial service company in Zhejiang Province, found the mechanism how entrepreneurs leverage innovation capabilities.
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