The impact of human capital on the early success of necessity versus opportunity-based entrepreneurs

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Baptista R., Karaoz M., Mendonca J.

SMALL BUSINESS ECONOMICS, vol.42, no.4, pp.831-847, 2014 (SSCI) identifier identifier

  • Publication Type: Article / Article
  • Volume: 42 Issue: 4
  • Publication Date: 2014
  • Doi Number: 10.1007/s11187-013-9502-z
  • Journal Name: SMALL BUSINESS ECONOMICS
  • Journal Indexes: Social Sciences Citation Index (SSCI), Scopus
  • Page Numbers: pp.831-847
  • Keywords: Entrepreneur human capital, Pre-entry capabilities, New firm survival, Opportunity-based entrepreneurship, Necessity-based entrepreneurship, SURVIVAL, KNOWLEDGE, ENTRY, SELECTION, EVOLUTION, EARNINGS
  • Akdeniz University Affiliated: No

Abstract

This paper examines whether founders' backgrounds influence new firm survival in the early years after startup, focusing, in particular, on the impact of unemployment-driven entrepreneurship. For entrepreneurs who left their previous employment to found a new firm, both general and specific human capital play a key role in enhancing early survival chances. However, various forms of human capital have little effect on early survival of unemployment-driven entrepreneurs, who rely mostly on previous entrepreneurial experience to persevere. Results suggest that pre-entry capabilities play an important role in the early success of opportunity-based entrepreneurs, but have little influence on the early success of necessity-based ones.