Entrepreneurial Orientation Growth Research Articles

Inadequacies in Local Entrepreneurial Ecosystems that Impede Growth-Oriented Entrepreneurship in Lesotho

Entrepreneurship is acknowledged globally as a driver of unemployment reduction, poverty alleviation and national economic well-being. However, many nations, especially developing ones, struggle to sustain growth-oriented entrepreneurship due to limitations in their entrepreneurial ecosystems. With an unemployment rate of 28.9% as of 2019, Lesotho is one of the countries struggling to sustain effective entrepreneurial ecosystems. This article seeks to identify the inadequacies in local entrepreneurial ecosystems that impede the emergence of entrepreneurs and small-and-medium enterprises in Lesotho. This study, grounded in systems theory, utilised a qualitative approach using semi-structured interviews to collect data from twenty-five budding entrepreneurs. Data analysis showed that financial institutions funding, entrepreneurial apathy, poor infrastructure, dearth of talents and leaders, and inadequate support networks were the main barriers to entrepreneurship in Lesotho. This study raises awareness of Lesotho's entrepreneurial ecosystem's basic flaws, which hinder growth-oriented business. The study is expected to improve policymakers’ intervention strategies and attract more scholars' attention to the phenomenon. The study is limited in scope due to the participants' concentration in Maseru, the capital city. This geographical restriction is a limitation to the extent that businesses operating in the city and those operating in the countryside may experience different systemic impacts. Future research should explore broader scope.

Start-ups in the Brazilian Innovation Ecosystem

The article analyses the dynamics of start-up growth in Brazil highlighting the role of government, companies, venture capital and the innovation system in start-up policy. The most significant recent change in the Brazilian start-up ecosystem was the rise of growth-oriented entrepreneurship and start-ups. The 2021 Brazilian Legal Framework of Start-ups and Innovative Entrepreneurship is a milestone as it establishes mechanisms for the acquisition of products/services by the government provided by start-ups.

Cross-country growth-oriented entrepreneurship: when is a performance-based culture effective

Cross-country growth-oriented entrepreneurship: when is a performance-based culture effective

Cross-country growth-oriented entrepreneurship: when is a performance-based culture effective

Cross-country growth-oriented entrepreneurship: when is a performance-based culture effective

How and When Does Growth-Oriented Entrepreneurship Happen in Poverty Contexts? The Case of Kenya

How and When Does Growth-Oriented Entrepreneurship Happen in Poverty Contexts? The Case of Kenya

Drivers of growth expectations in Latin American rural contexts

PurposeGiven the importance of growth-oriented entrepreneurship in the context of economic development and the need to understand how rural communities can be developed, the purpose of this research paper is to determine how the drivers of growth expectations differ between urban and rural settings.Design/methodology/approachThe methodology is threefold: firstly, a descriptive analysis with non-parametric testing is conducted; then pooled regression model is used to analyse the predictors of growth expectations in both contexts, and finally, coarsened exact matching is used to identify possible self-selection bias.FindingsIn contrast to mainstream entrepreneurship theory, it is found that entrepreneurs’ intrinsic knowledge, skills and abilities are not significant in the rural-specific model. The only exception is entrepreneurs’ educational level, the importance of which is emphasised as a pivotal factor in increasing high-growth ventures in rural communities. Additionally, when self-selection is eliminated, rurality worsens growth intentions.Practical implicationsThere is evidence that some growth-oriented entrepreneurs self-select into rural communities. Because the high-growth entrepreneurial dynamics in rural areas are unique, public policies should target purpose-driven entrepreneurial education. This includes encouraging “lifestyle entrepreneurship” (e.g. retirees returning to rural areas to become entrepreneurs), preventing entrepreneurial brain drain in rural areas and attracting highly educated urban entrepreneurs to exploit opportunities in rural areas.Originality/valueThis research attempts to contribute to the ongoing debate regarding the factors that drive high-growth entrepreneurs in rural areas by analysing rural entrepreneurs in the high-growth context of a developing economy. The focus is on Chile – a country that is rarely investigated compared to the USA or Europe – to extend the literature on high-growth ventures and entrepreneurial ecosystems.

Growth-Oriented Entrepreneurship

Growth-Oriented Entrepreneurship

Entrepreneurship in Cities

Impactful, growth-oriented entrepreneurship is a major research and policy focus. Building on arguments put forward by Jane Jacobs more than 50 years ago, we propose that local knowledge spillovers in a city are enhanced by human agency in that city (e.g. local psychological openness). This effect is critically amplified by the catalyst function of a favorable structural city environment that not only connects these agentic people (via urban density), but also facilitates the production and flow of new knowledge for these connected agentic people (via a diverse industry mix). This three-way interaction effect was confirmed in our empirical investigation of quality entrepreneurship across the MSAs (cities) in the US, using a large-scale dataset of the psychological profiles of millions of people. Local openness shows a robust positive effect on the level of quality entrepreneurship. This effect is further strengthened by a favorable structural city environment (i.e. high density and diversity) by up to 35%. Reviving Jacobs’ people focus, the results indicate that the best performing cities in terms of knowledge spillovers and economic performance are those that are not only home to, and attract, agentic people, but also empower these people by means of a physical and industrial city landscape that enables them to act in more innovative and entrepreneurial ways, as envisioned by Jacobs. We discuss the policy implications of our findings and an agenda for future research.

Entrepreneurial Orientation, MSME Growth and the Mediating Role of Firm Strategic Capabilities in the Manufacturing Sector in Nairobi County, Kenya

Growth among Micro, Small and Medium-sized Enterprises (MSME) is of eminence to economic progression in both developed and developing economies, credited for employment creation, driving innovation and contribution to Gross Domestic Product (GDP) in both contexts. Whereas entrepreneurial orientation has been identified to underpin MSME growth, several studies on entrepreneurial orientation -growth nexus have provided mixed results based on the aggregated one-dimensional measure of entrepreneurial orientation. While some report a significant association, some report no significance. The mixed findings imply that the relationship between entrepreneurial orientation and growth is not linear, pointing to other causal factors either internal or external to the enterprise. against this backdrop, this study set out to assess the mediating effect of firm strategic capabilities on the relationship between entrepreneurial orientation and growth of manufacturing sector MSMEs in Kenya. Anchored on the contingency fit view, the resource-based view and the life-cycle theory, the study adopted a positivist approach, employing the explanatory research design of a cross sectional nature. With a target population of 98,607, a stratified sample of 384 MSMEs from the manufacturing sector in Nairobi County was drawn. Data was collected by use of structured questionnaires and analyzed by both descriptive and inferential statistics including Pearson correlation and regression analyses. The study controlled for both age and sub-sector, as they have been previously found to affect firm growth. Results indicate that entrepreneurial orientation has a significant effect on firm strategic capabilities (β = .276, p = .000<.05). The study also found that firm strategic capabilities have a significant effect on MSME growth at 95% confidence level (β = .124, p = .026<.05). Firm strategic capabilities did not however have a significant mediating effect on the relationship between entrepreneurial orientation and MSME Growth (β = .0617, p = 111>.05; LLCI=-.0020; ULCI=.0273). The study concludes that among MSMEs in the manufacturing sector in Kenya, innovative, risk tolerant and proactive owners/managers are likely to achieve growth, regardless of their strategic capabilities. It is recommended that MSME owners/managers innovate, take risks and stay proactive in their businesses in order to grow. It is also recommended that strategic policy decisions of MSMEs should focus on enhancing their positions in respect of innovativeness, proactiveness and risk propensity.

Formal institutions and the development of entrepreneurial activity – the contingent role of corruption in emerging economies

PurposeThe paper aims to analyse the interplay between formal and informal institutions' and their impact on entrepreneurship rates in emerging economies.Design/methodology/approachThis study expands previous research in examining the moderating effect of control of corruption on the relationship between formal institutions and the development of the entrepreneurial activity. The study utilizes longitudinal analyses of a dataset from 41 emerging economies over 11 years (2006–2016).FindingsFindings provided robust support for the study's hypotheses. The results suggested lower levels of corruption positively moderate the effects of a country's number of procedures and education and training on the rates of entrepreneurial activity, while negatively moderating the effects of firm-level technology absorption on the rates of entrepreneurial activity.Research limitations/implicationsThe study has considered only one particular aspect of high-growth entrepreneurship, which is newly registered firms with limited liability. Although newly registered firms are recognized as one of the critical drivers of entrepreneurial activity. Future research should seek to examine other aspects of growth-oriented entrepreneurship such as activities involving a high level of innovation, corporate entrepreneurship or technology developments.Practical implicationsThis study advanced the existing theories in the field of entrepreneurship and institutional economics as it merged the two theories as a driving framework in the design of the study in the context of emerging economies.Social implicationsThe study tested a theoretical model by expanding the number of emerging economies in the study and found comparable findings that explain factors that may influence the likelihood of individuals entering entrepreneurship.Originality/valueThis article adds to the current literature as it highlights the importance of the interplay of formal and informal institutions in determining their impact on entrepreneurship rates in emerging economies. This is of particular importance to policy-makers, and the business world as the empirical results of this study show the benefits of control of corruption in boosting entrepreneurial rates in these economies, which strive for economic diversification in their developmental endeavours.

Which Entrepreneurs Are Financially Constrained?

We study what type of entrepreneurs are affected by financial constraints by exploiting age-based discontinuities in the amount of funding available through a public program for unemployed workers. Our sample links administrative data on 2.1 million eligible workers to the firms they create, spanning a wide range of skills, sectors and outcomes. We find that access to funding increases the rate of entrepreneurship and that the effect is stronger for entrepreneurs who incorporate their business, especially for those who were in the top decile of the wage distribution before unemployment. Among incorporated entrepreneurs, the effect is strongest in the information and communication sector, followed by manufacturing. In terms of ex-post outcomes, we find that the effect is more pronounced for businesses in the upper half of the size, growth and profitability distributions. Our findings suggest that financial constraints hamper growth-oriented entrepreneurship.

The Barriers to High-Growth Enterprises: What Do Businesses in Africa Experience?

This study examines the challenges that micro, small and medium enterprises (MSMEs) face and provide insights on African business environment and entrepreneurial ecosystem. In the context of growth-oriented entrepreneurship, good policies and favourable institutional environments support firms' growth, productivity and development, while adverse formal and informal institutions constrain business development. Secondary data from World Bank Enterprise Survey (WBES) was used to capture barriers to entrepreneurship and high-growth opportunities which include – lack of finance, lack of innovation and technology, low skilled workforce, poor infrastructure, unfavorable regulations and more pervasively corruption. These barriers are evident in the micro, meso and macro environments. These have implications on the unemployment rate, poverty rates and economic growth of the African region.
 Keywords: Micro, Small and Medium Enterprises; Entrepreneurial Ecosystem; African Entrepreneurship; African Business Environments.

Digitalization of work and entry into entrepreneurship

We investigate the relationship of the new wave of digitalization of occupations with entry into different types of entrepreneurship in the United States, including entry into digital entrepreneurship. Based on the Current Population Survey for 2011–18 and using different measures of digitalization that reflect its destructive and transformative impacts on occupations, we provide evidence that digitalization is significantly associated with entrepreneurial entry at the individual level. The results suggest that high-skilled employees and employees in ICT occupations facing destructive digitalization have an increased likelihood of becoming entrepreneurs with unincorporated businesses. However, entrepreneurship does not seem to be a viable option for low-skilled individuals affected by destructive digitalization. We further find that starting an incorporated business is more likely and starting an unincorporated business is less likely for employees facing transformative digitalization. Apparently, advances in AI create opportunities for growth-oriented entrepreneurship, but also increase the opportunity cost of less ambitious entrepreneurship.

Does all entrepreneurship matter? The contribution of entrepreneurial activity to economic growth

Purpose The purpose of this paper revisits the effect of entrepreneurship on economic growth. Design/methodology/approach Using a cross-country panel data set of 61 countries in the period 2002–2014, this paper empirically analyzes the differences in contribution to economic growth. Particularly, using an extension of the Cobb–Douglas production function, the authors show the role of entrepreneurship in developed and developing economies. Global entrepreneurship monitor data were used to estimate the proposed types of entrepreneurship. Findings Results indicate that economic growth can be explained by growth-oriented entrepreneurship, including developing economies. These results remain robust to a variety of specifications that include economic, social and cultural controls, and two ways of sorting countries by stage of development. Originality/value The authors split the total entrepreneurial activity (TEA) according to job expectations, in order to isolate the effect of entrepreneurial activity that is growth oriented (dynamic) and not (regular). Lastly, the empirical application presented comprises a more adequate timeframe to analyze the proposed relationship, determining possible differences for developed and developing economies.

Executive forum:linking women’s growth-oriented entrepreneurship policy and practice: results from the Rising Tide Angel Training Program

The Rising Tide Angel Training Program was launched to address the public policy priority of increasing the number of growth-oriented women-owned firms by expanding the entrepreneurial ecosystem in ways that will benefit women. In particular, the founders sought to address structural weaknesses in a key component of the entrepreneurial ecosystem, women’s access to financial capital in the form of equity, mentorship, and contacts. The Rising Tide Angel Training Program was launched in the fall of 2015 with the goal of increasing the number of women angel investors capable of investing in growth-oriented women-owned firms through a program of education, training, and hands-on experience with the angel investing process. In this paper, we present our findings from the first Rising Tide training cohort in terms of changes in participants’ motivations, attitudes, and expectations as they relate to angel investing. We also present findings on changes in knowledge, skills, and the ability to evaluate investment opportunities. Finally, we identify and discuss key “takeaways” from our first year’s experience with the Rising Tide Angel Training Program and next steps.

Antecedents of growth-oriented entrepreneurship before and during the Greek economic crisis

PurposeThe purpose of this paper is to explore potential drivers of high-growth intentions of early-stage entrepreneurs in Greece before and after the onset of the financial crisis of 2008.Design/methodology/approachTo this end, the authors use individual-level data retrieved from Global Entrepreneurship Monitor annual surveys (2003-2015).FindingsThe results show that high-growth intentions of Greek entrepreneurs are driven by different factors in the crisis compared to the non-crisis period. Male entrepreneurs and entrepreneurs with significant work experience seem to be more likely to be engaged in growth-oriented new ventures during the crisis period. The same appears to hold for entrepreneurs who are motivated by an opportunity and also perceive future business opportunities in adverse economic conditions. On the other hand, the educational level and the social contacts of founders with other entrepreneurs are found to drive ambitious Greek entrepreneurship in the years before the crisis, while they were insignificant after the crisis outbreak.Originality/valueBased on the concept of ambitious entrepreneurship, this study contributes to the literature by investigating the determinants of entrepreneurial high-growth expectations in the Greek context emphasizing the crisis period in comparison to the pre-crisis years.

Looking inside the spiky bits: a critical review and conceptualisation of entrepreneurial ecosystems

The concept of entrepreneurial ecosystems has quickly established itself as one of the latest ‘fads’ in entrepreneurship research. At face value, this kind of systemic approach to entrepreneurship offers a new and distinctive path for scholars and policy makers to help understand and foster growth-oriented entrepreneurship. However, its lack of specification and conceptual limitations has undoubtedly hindered our understanding of these complex organisms. Indeed, the rapid adoption of the concept has tended to overlook the heterogeneous nature of ecosystems. This paper provides a critical review and conceptualisation of the ecosystems concept: it unpacks the dynamics of the concept; outlines its theoretical limitations; measurement approaches and use in policy-making. It sets out a preliminary taxonomy of different archetypal ecosystems. The paper concludes that entrepreneurial ecosystems are a highly variegated, multi-actor and multi-scalar phenomenon, requiring bespoke policy interventions.

Examining Facilitative Configurations of Entrepreneurially Oriented Growth: An Information Processing Perspective

AbstractThis study examines how the relationship between entrepreneurial orientation and firm growth is shaped by learning orientation in technologically sophisticated environments. We draw upon an information processing perspective that emphasizes alignment between information processing demands and support mechanisms. Using data from 116 small to medium‐sized enterprises in the Netherlands, we observe that the ability of entrepreneurial orientation to drive firm growth greatly depends on the joint consideration of technological sophistication and learning orientation. Our findings contribute to a better understanding of how configurations of strategic orientations and environmental considerations work in concert to influence the efficacy of organizational entrepreneurial efforts dramatically.

여성의 고성장기업 창업이 저조한 원인

우리나라와 OECD국가의 여러 연구에 의하면, 고성장 창업기업이 일자리 창출의 가장 큰 기여자로서 지속적인 경제성장을 위해서는 이들 기업의 창업이 매우 중요하다. 여성의 경제활동 증가도 경제성장을 촉진하며, 여성의 창업률이 남성에 비해 저조하므로 여성의 창업증진이 경제발전에 도움이 될 것이다. 본 논문은 여성의 고성장 기업창업이 남성 창업에 비해 적은 원인을 찾기 위해서 여러 가지 기업실태조사 자료를 이용하여 여성과 남성기업을 비교 분석하였다. 여성창업은 전체기업의 34%를 차지하고 있으나 고성장 기업일 경우는 6% 이하의 점유율을 나타낸다. 여성기업의 특징은 남성기업에 비해 초기투자자금이 적고, 외부자금조달이 어려워서 소규모기업에 집중되어 있다. 창업을 위한 장애요인은 여성 과 남성기업이 매우 유사하지만, 여성기업의 남성기업과 차별화된 장애요인이며, 또한 여성의 고성장기업 창업을 어렵게 만드는 3가지 요인은, 외부자금 조달의 어려움(고성장 기업인 경우 자금조달의 어려움이 다른 산업에 비해 높게 나타남), 창업을 위한 아이디어와 경험 및 기술의 부족, 일 과 가정의 병행 어려움이다. 이 결과는 미국의 연구결과(자금조달의 어려움, 일과 가정의 병행 애로, 여성을 위한 멘토의 부족) 와 비슷한 결과이다. 여성의 고성장기업의 창업은 아이디어와 경험 및 지식의 부족과 관련되어 추가 연구가 더 필요할 것이다. Research on OECD and Korea have shown that high-growth startups are the keys to job creation and that these companies are very important for economic growth. Given that the large-scale entry of women into the labor force accelerates economic growth and women have far lower levels of participation in growth-oriented entrepreneurship than men do, accelerating female entrepreneurship could have positive effects on the Korean economy. This paper uses data from several databases to do a comparison analysis between women's and men's start-ups to explore the factors that explain the lag in building high-growth firms among women. Women startups make up nearly 34% of startups(defined as less than 7 years of establishment), but only 6% of high-growth startups. Women rarely own large businesses, reflecting their low levels of initial capital and outside financing. Regardless of gender, entrepreneurs face many of the same challenges in starting businesses, but this study shows three primary factors for female entrepreneurs that lead to a less high-growth startup: a greater financing gap than for men(this gap is more apparent for high-growth firms), a lack of ideas, knowledge, and experience(related to the lack of mentorship), and lastly the difficulty maintaining a work-life balance. The findings are very similar with those found in studie's in the US(financing gap, work-life balance, and lack of mentorship). Further studies are required to identify more specific factors behind the gender gap in ideas, knowledge, and experience.

Cross-country growth-oriented entrepreneurship: When is a performance-based culture effective?

Early inquiries into the contribution of performance-based cultural norms to growth-oriented entrepreneurship render their influence not significant. In a similar effort to explain cross-country differences in growth-oriented entrepreneurship, we propose and test a midrange, contingency-based model receiving strong support in analysis of 267 country-year observations from 66 countries. Results show economic development complements performance-based cultural norms to increase the extent of a country’s growth-oriented entrepreneurship; and this complementary effect appears only among those countries with high levels of regulatory simplicity. For policymakers targeting economic growth, our research suggests that policies should create a fertile environment for growth-oriented entrepreneurship to thrive on the established norms within their particular society; rather than benchmark possible approaches against other countries with high levels of growth-oriented entrepreneurship but very different established n...