Going it Alone or Working as Part of a Team: The Impact of Human Capital on Entrepreneurial Decision Making
Keywords:Human capital, Entrepreneurial Team, Entrepreneurial Decision, Lone Entrepreneurship
AbstractThis paper endeavours to measure the effect that human capital has on the decision taken by the entrepreneur to pursue new venture creation either in a lone capacity or collaboratively. Based on a survey of 130 entrepreneurs from 130 new ventures in Canary Island, Spain, this study applies a logit model to investigate the research relationships. The results show that three factors (experience, social perception and extrinsic motivation) are significant in the decision to initiate a new venture either in a lone capacity or as part of a collaborative undertaking. The results indicate that previous experience holds the greatest significance on the decision taken by entrepreneurs to ‘go it alone’, with factors relating to social perception and extrinsic motivation chiefly predicting a decision to work collaboratively. The findings of this study provide new insight and evidence with regard to the factors that influence a key decision in the start-up process: that of continuing in a lone capacity, or proceeding as part of an entrepreneurial team.
Aldrich, H.E., & Kim, P.H. (2007). Small worlds, infinite possibilities? How social networks affect entrepreneurial team formation and search. Strategic Entrepreneurship Journal, 1(1-2), 147-165. Andriessen, D. (2004). IC valuation and measurement: classifying the state of the art. Journal of Intellectual Capital, 5(2), 230-242. Aviram, A. (2006). A study of factors that influence unemployed persons. Journal of Employment Counseling, 43, 154-167. Baron, R.A., & Markman, G.D. (2003). Beyond social capital: the role of entrepreneurs social competence in their financial success. Journal of Business Venturing, 18(1), 41-60. Basu, A., & Goswami, A. (1999). Determinants of South Asian entrepreneurial growth in Britain: a multivariate analysis. Small Business Economics, 13, 57-70. Baumeister, R.F., & Leary, M.R. (1995). The need to belong: Desire for interpersonal attachments as a fundamental human motivation. Psychological Bulletin, 117, 497-529. Becker, B.E., Huselid, M.A., & Ulrich, D. (2001). The HR scorecard: linking people, strategy, and performance. Boston: Harvard Business School Press. Ben-Hafaiedh-Dridi, C. (2010). Entrepreneurial team formation: Any rationality?. Frontiers of Entrepreneurship Research, 30(10), Article 1. Birley, S. (1984). Finding the new firm. Proceedings of the Academy of Management Meetings, 47, 64-68. Bontis, N. (1998). Intellectual capital: and exploratory study that develops measures and models. Management Decision, 36(2), 63-76. Bontis, N. (2002). National intellectual capital index: Intellectual capital development in the Arab Region. Ontario: Institute for Intellectual Capital Research. Bosma, N., Van Praag, M., Thurik, R., & DeWit, G. (2004). The value of human and social capital investments for the business performance of start-ups. Small Business Economics, 23, 227-236. Boyd, N.G., & Vozikis, G.S. (1994). The influence of self-efficacy on the development of entrepreneurial intentions and actions. Entrepreneurship Theory and Practice, 18, 63-77. Brüderl, J., Preisendörfer, P., & Ziegler, R. (1992). Survival chances of newly funded business organizations. American Sociological Review, 57(2), 227-242. Burn, S.M. (2004). Groups. Theory and practice. California: Thonson and Wadsworth. Cartwright, D., & Zander, A. (1968). Group dynamics: Research and theories. New York: Harper and Row. Chandler, G.N., & Jansen, E. (1992). The founder’s self-assessed competence and venture performance. Journal of Business Venturing, 7(3), 223-236. Chandler, G.N., & Lyon, D.W. (2009). Involvement in knowledge-acquisition activities by venture team members and venture performance. Entrepreneurship Theory and Practice, 33(3), 571-592. Chowdhury, S. (2005). Demographic diversity for building an effective entrepreneurial team: is it important?. Journal of Business Venturing, 20, 727-746. Collins-Dodd, C., Gordon, I.M., & Smart, C. (2004). Further evidence on the role of gender in financial performance. Journal of Small Business Management, 42(4), 395-417. Cooney, T.M. (2005). What is an entrepreneurial team?. International Small Business Journal, 23(3), 226-235. Decker, W.H., Calo, T.J., & Weer, C.H. (2012). Affiliation motivation and interest in entrepreneurial careers. Journal of Managerial Psychology, 27(3), 302-320. Duchesneau, D.A., & Gartner, W.B. (1990). A profile of new venture success and failure in an emerging industry. Journal of Business Venturing, 5, 297-312. Edvinsson, L., & Malone, M. (1997). Intellectual capital: realising your company's true value by finding its hidden brainpower. New York: Harper Collins. Eisenhart, K.M., & Schoonhoven, C.B. (1990). Organizational growth: Linking founding team, strategy, environment, and growth among U.S. semiconductor ventures. Administrative Science Quarterly, 35, 504-529. Ensley, M.D., Pearson, A.W., & Amason, A.C. (2002). Understanding the dynamics of new venture top management teams: cohesion, conflict, and new venture performance. Journal of Business Venturing, 17(4), 365-386. Forbes, D.P., Borchert, P.S., Zellmer-Bruhn, M.E., & Sapienza, H.J. (2006). Entrepreneurial Team Formation: An Exploration of New Member Addition. Entrepreneurship Theory and Practice, 30(2), 225-248. Frances, D.H., & Sandberg, W.R. (2000). Friendship within entrepreneurial teams and its association with team and venture performance. Entrepreneurship Theory and Practice, 25(2), 5-26. Friar, J.H., & Meyer, M.H. (2003). Entrepreneurship and start-ups in the Boston region: factors differentiating high-growth ventures from micro-ventures. Small Business Economics, 21, 145-152. Gatewood, E.J., Shaver, K.G., & Gartner ,W.B. (1995). A longitudinal study of cognitive factors influencing start-up behaviours and success at venture creation. Journal of Business Venturing, 10, 371-391. Gilad, B., & Levine, P. (1986). A Behavioral Model of Entrepreneurial Supply. Journal of Small Business Management, 24, 45. Gimeno, J., Folta, T., Cooper, A., & Woo, C. (1997). Survival of the fittest? Entrepreneurial human capital and the persistence of underperforming firms. Administrative Science Quarterly, 42(4), 750-783. Hambrick, D.C., Cho, T.S., & Chen, M. (1996). The influence of top management team heterogeneity on firms’ competitive moves. Administrative Science Quarterly, 41(4), 659-684. Hill, C.A. (1987). Affiliation motivation: People who need people… but in different ways. Journal of Personality and Social Psychology, 52(5), 1008-1018. Higashide, H., & Birley, S. (2002). The consequences of conflict between the venture capitalist and the entrepreneurial team in the United Kingdom from the perspective of the venture capitalist. Journal of Business Venturing, 17(1), 59-78. Hoang, H., & Antoncic, B. (2003). Network-based research in entrepreneurship: a critical review. Journal of Business Venturing, 18, 165-187. Hosmer, D.W., & Lemeshow, S. (2000). Applied Logistic Regression. New York: John Wiley & Sons, Inc. Huici, C., Molero, F., Gómez, A., & Morales, J.F. (2011). Psicología de los Grupos. Madrid: UNED. Janney, J.J., & Dess, G.G. (2006). The risk concept for entrepreneurs reconsidered: New challenges to the conventional wisdom. Journal of Business Venturing, 21(3), 385-400. Johannisson, B., Centeno Caffarena, L., Discua Cruz, A., Hormiga Pérez, E., Kapelko, M., Murdock, K., Nanka-Bruce, D., Olejarova, M., Sánchez López, A., Sekki, A., Stoian, C., Tötterman, H., & Bisignano, A. (2007). Interstanding the industrial district: Contrasting Conceptual Images as a Road to Insight. Entrepreneurship and Regional Development, 19, 527-554. Johanson, U. (2005). A human resource perspective on intellectual capital. In B. Marr (Ed.), Perspective on intellectual capital. Multidisciplinary insights into management, measurement and reporting (pp. 96-105). Boston: Elsevier. Kamm, J.B., & Nurick, A.J. (1993). The stages of team venture formation: A decision-making model. Entrepreneurship Theory and Practice, 17(2), 17-27. Kamm, J.B., Shuman , J.C., Seeger, J.A., & Nurick, A.J. (1990). Entrepreneurial teams in new venture creation: a research agenda. Entrepreneurship Theory and Practice, 14(4), 7-17. Lechler, T. (2001). Social interaction: a determinant of entrepreneurial team venture success. Small Business Economics, 16, 263-278. Lerner, M., & Almor, T. (2002). Relationships among strategic capabilities and the performance of women‐owned small ventures. Journal of Small Business Management, 40(2), 109-125. Marr, B., & Roos, G. (2005). Astrategy perspective on intellectual capital. In B. Marr (Ed.), Perspective on intellectual capital. Multidisciplinary insights into management, measurement and reporting (pp. 28-41). Boston: Elsevier. Miller, M., DuPont, B.D., Fera, V., Jeffrey, R., Mahon, B., Payer, B.M., & Starr, A. (1999). Measuring and reporting intellectual capital from a diverse Canadian industry perspective. Paper presented at the International Symposium Measuring Reporting Intellectual Capital: Experiences, Issues, and Prospects, OECD, Amsterdam. Molleman, E., & Slomp, J. (2006). The impact of team and work characteristics on team functioning. Human Factors and Ergonomics in Manufacturing & Service Industries, 12(1), 1-15. Nicolaou, N., & Birley, S. (2003). Social networks in organizational emergence: the university spinout phenomenon. Management Science, 49(12), 1702-1725. Peña, I. (2002). Intellectual capital and business start-up success. Journal of Intellectual Capital, 3(2), 180-198. Rafferty, J., & Tapsell, J., (2001). Self-managed work teams and manufacturing strategies: Cultural influences in the search for team effectiveness and competitive advantage. Human Factors and Ergonomics in Manufacturing & Service Industries, 11(1), 19-34. Rauch, A., Frese, M., & Utsch, A. (2005). Effects of human capital and long-term human resources development and utilization on employment growth of small-scale business: A causal analysis. Entrepreneurship Theory and Practice, 29(6), 681-698. Ribeiro-Soriano, D., & Urbano, D. (2009). Overview of collaborative entrepreneurship: An integrated approach between business decisions and negotiations. Group Decision and Negotiation, 18(5), 419-430. Roberts, E. (1989). The personality and motivations of technological entrepreneurs. Journal of Engineering and Technology Management, 1(1), 1-19. Roberts, E. (1991). Entrepreneurs in high-technology: Lessons from MIT and beyond. New York: Oxford University Press. Roure, J.B., & Maidique, M.A. (1986). Linking prefunding factors and high technology venture success: An exploratory study. Journal of Business Venturing, 1(3), 295-306. Sandberg, W.R., & Hofer, C.W. (1987). Improving new venture performance: the role of strategy, industry structure and entrepreneur. Journal of Business Venturing, 2(1), 5-29. Scherer, R.F., Adams, J.S., Carley, S.S., & Wiebe, F.A. (1989). Role model performance effects on development of entrepreneurial career preference. Entrepreneurship Theory and Practice, 13, 53-71. Schjoedt, L., & Kraus, S. (2009). Entrepreneurial teams: definition and performance factors. Management Research News, 32(6), 513-524. Segal, G., Borgia, D., & Schoenfeld, J. (2005). The motivation to become an entrepreneur. International Journal of Entrepreneurial Behaviour & Research, 11(1), 42-57. Shane, S.A., & Stuart, T. (2002). Organizational endowments and the performance of university start-ups. Management Science, 48, 154-170. Smith, J.L., & Ruiz, J.M. (2007). Interpersonal orientation in context: Correlates and effects of interpersonal complementary on subjective and cardiovascular experiences. Journal of Personality, 75(4), 679-708. Storey, D.J. (1994). Understanding the Small Business Sector. London-Boston: International Thomson Business Press. Stuart, R.W., & Abetti, P.A. (1990). Impact of entrepreneurial and management experience on early performance. Journal of Business Venturing, 5, 151-162. Sveiby, K.E. (2000). La nueva riqueza de las empresas. Barcelona: Gestión 2000. Tihula, S., Huovinen, J., & Fink, M. (2009). Entrepreneurial teams vs management teams. Reasons for team formation in small firms. Management Research News, 3(6), 555-566. Timmons, J. (1999). New Venture Creation: Entrepreneurship for the 21st century. Boston, MA: Irwin/McGraw Hill. Utterback, J., Meyer, M., Roberts, E., & Reitberger, G. (1988). Technology and industrial innovations in Sweden: A study of technology-based firms formed between 1965 and 1980. Research Policy, 17, 15-26. Vanaelst, I., Clarysse, B., Wright, M., Lockett, A., Moray, N., & S’Jegers, R. (2006). Entrepreneurial team development in academic spinouts: An examination of team heterogeneity. Entrepreneurship Theory and Practice, 30(2), 249-271. Van Praag, C.M. (2003). Business survival and success of young small business owners. Small Business Economics, 21, 1-17. Van Praag, C.M., & Cramer, J.S. (2001). An estimated equilibrium model of business formation and labour demand by entrepreneurs. Economica, 68(269), 45-62. Vesper, K.H. (1990). New Venture Strategies. New Jersey: Prentice-Hall, Englewood Cliffs. Viedma Marti, J.M. (2001). ICBS – Intellectual Capital Benchmarking System. Journal of Intellectual Capital, 2(2), 148-165. Vyakarnam, S., & Handelberg, J. (2005). Four themes of the impact of management teams on organizational performance: Implications for future research of entrepreneurial teams. International Small Business Journal, 23(3), 236-256. Walter, A., Auer, M., & Ritter, T. (2006). The impact of network capabilities and entrepreneurial orientation on university spin-off performance. Journal of Business Venturing, 21, 541-567. Watson, K., Hogarth-Scott, S., & Wilson, N. (1998). Small business start-ups: success factors and support implications. International Journal of Entrepreneurial Behaviour & Research, 4(3), 217-238. Watson, W.E., Ponthieu, L., & Critelli, J.W. (1995). Team interpersonal process effectiveness in venture partnerships and its connection to perceived success. Journal of Business Venturing, 10(5), 393-411. Watson, W., Stewart, W.H., & BarNir, A. (2003). The effects of human capital, organizational demography and interpersonal processes on venture partner perceptions of firm profit and growth. Journal of Business Venturing, 18(2), 145-164. West, G.P. (2007). Collective cognition: When entrepreneurial teams, not individuals, make decisions. Entrepreneurship Theory and Practice, 31(1), 77-102. Wood, R., & Bandura, A. (1989). Social cognitive theory of organizational management. The Academy of Management Review, 14, 361-384. Zahra, S.A. (2007). Contextualizing theory building in entrepreneurship research. Journal of Business Venturing, 22, 443-452. Zenger, M., Berth, H., Brähler, E., & Stöbel-Richter, Y. (2013). Health Complaints and Unemployment: The Role of Self-Efficacy in a Prospective Cohort Study. Journal of Social and Clinical Psychology, 32(1), 97-115. Zhao, H., & Seibert, S.E. (2006). The Big Five personality dimensions and entrepreneurial status: A meta-analytical review. Journal of Applied Psychology, 91(2), 259-271.
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License
Authors transfer to Universitat de Barcelona all copyright. Creative Commons
Created from a work avaible in http://revistes.ub.edu/index.php/JESB