Principal Topic

Habitual entrepreneurship is a relatively neglected aspect of entrepreneurship. Evidence available from several countries, however, suggests that it is an extensive phenomenon. This paper develops a resource-based perspective on habitual entrepreneurs. Habitual entrepreneurs may start or purchase several businesses which they may own at one time or sequentially. These dimensions give rise to four categories of habitual entrepreneur: serial start-ups, portfolio start-ups, serial acquirers (through management buy-out (MBO) or management buy-in (MBI)) and portfolio acquirers (through MBO or MBI). Adopting a resource-based approach to habitual entrepreneurship, the paper develops testable propositions relating to the key dimensions of habitual entrepreneurs’ resource development, search and learning behavior. The cognitive behaviors displayed by habitual entrepreneurs when identifying opportunities and learning from experience are discussed. The role of entrepreneurial experience is explored by identifying the assets and liabilities of entrepreneurial experience and the learning processes followed by entrepreneurs.

Method

The study is based on case studies. For each case study (two for each category above), longitudinal data collection was employed over a five to seven year period involving mail questionnaires, face-to-face interviews and telephone interviews. Given the difficulties in obtaining a large representative sample of habitual entrepreneurs, and the nature of the research addressed, a case study approach is the most appropriate methodology to develop theory. The approach is essentially a discovery oriented one in which empirical evidence is combined with existing knowledge to develop theoretical insights which can inform further research in the area.

Implications

For researchers, the propositions developed suggest areas for further analysis. Quantitative studies may be especially useful for testing the generalizability of the propositions generated in the paper. For practitioners, the findings of the paper help to understand the behavior of habitual entrepreneurs. Under the resource-based approach developed in the paper, entrepreneurs may be viewed as “idiosyncratic” and “path-dependent” units. While exploring entrepreneurs as sets of resources and capabilities is likely to aid our understanding of entrepreneurship, the approach is likely to be of great use in understanding which paths entrepreneurs take (i.e. strategies) and how this will affect performance. The paper also highlights, that while the cognitive behaviors of entrepreneurs may determine the viability and nature of the entrepreneurial act, they may also serve as a barrier, as in the case of experience and learning.