Abstract
PurposeThis study presents and validates a theoretical model linking individual characteristics of the founding or lead innovative entrepreneur of a start-up venture – the entrepreneur's values, entrepreneurial attitudes and entrepreneurial self-efficacy – to the firm's entrepreneurial orientation (EO) and market orientation (MO) and, ultimately, to firm performance.Design/methodology/approachWe conducted a survey on a stratified random sample of founders of early-stage South Australian micro- and small enterprises with a response rate of 24% (N = 204). Structural equation modelling was used to evaluate the model.FindingsThe study found that there is a significant relationship between the individual lead entrepreneur and firm strategies developed in early-stage firms in explaining firm performance. It also found that internal values are positively related to entrepreneurial attitude. Entrepreneurial attitude is positively related to entrepreneurial self-efficacy and EO innovativeness. In turn, entrepreneurial self-efficacy is related to innovativeness, proactiveness and risk-taking. The proactiveness dimension of EO and entrepreneurial attitude is related to MO. Entrepreneurial self-efficacy, innovativeness and MO are related to firm performance.Research limitations/implicationsThis research was limited to entrepreneurial ventures in South Australia and may lack generalisability in other states and countries.Originality/valueThe research contributes to the understanding of the heterogeneity within self-employed individuals, in particular among innovative entrepreneurs, by expanding insights regarding antecedents and consequences of the entrepreneurial process. It develops insights into the links of individual-level constructs with firm-level constructs to develop a more meaningful understanding of new venture creation and performance. It enhances our knowledge of the heterogeneity within the group of self-employed by exploring the individual entrepreneurial antecedents of performance in early-stage firms.
Highlights
Though the statistics vary across countries and cultures, typically, less than one-third of new businesses survive more than five years (Timmons and Spinelli, 2007), especially for start-ups operating and competing in global markets (Nummela et al, 2016)
Low and MacMillan (1988) note that entrepreneurship early-stage occurs at different levels and that it is important that entrepreneurship research be conducted at different levels in order to better understand the complexity of the entrepreneurial phenomenon
Given that the data set fits the model, the following observations can be made about the results with the standardised regression weights, squared correlation (R2) details and relevant hypotheses appearing in Figure 2 structural model
Summary
Though the statistics vary across countries and cultures, typically, less than one-third of new businesses survive more than five years (Timmons and Spinelli, 2007), especially for start-ups operating and competing in global markets (Nummela et al, 2016). There are numerous reasons for failure including macroeconomic conditions, competition, poor market selection, a flawed business model, an inadequate team and poor cash flow. Some of these factors are International Journal of Manpower Vol 42 No 2, 2021 pp. In their influential paper, Low and MacMillan (1988) note that entrepreneurship early-stage occurs at different levels (individual, organisational and/or aggregate levels) and that it is important that entrepreneurship research be conducted at different levels in order to better understand the complexity of the entrepreneurial phenomenon. This paper presents and validates a theoretical model linking individual characteristics of the founding or lead innovative entrepreneur of a start-up venture – the entrepreneur’s values, entrepreneurial attitudes and entrepreneurial selfefficacy (ESE) – to the firm’s entrepreneurial orientation (EO) and market orientation (MO)
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