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Exploring the impact of different types of prior entrepreneurial experience on employer firm performance

Andrew Burke, Jose Maria Millan (), Concepción Román and André van Stel

Journal of Business Research, 2018, vol. 90, issue C, 107-122

Abstract: We investigate the impact of prior entrepreneurial experience on current performance of firms with employees (employer firms). We distinguish between external entrepreneurial experience obtained outside of the current firm and internal entrepreneurial experience obtained within the boundaries of the employer firm currently run. Regarding the latter we focus on a special type of prior internal experience, i.e. as an own-account worker before scaling up to employer firm. Theoretically, both types of prior entrepreneurial experience are associated with different processes of learning-by-doing. Empirically, we find that both external entrepreneurial experience and internal experience as an own-account worker enhance employer firm performance. Our results therefore imply that, for individuals without any prior entrepreneurial experience wishing to start a new firm, a lean start-up strategy (as an own-account worker) is to be preferred over a more resourceful strategy hiring employees from the start.

Keywords: Internal and external entrepreneurial experience; Learning-by-doing; Start-up size strategy; Lean start-up; New venture job creation; Novice entrepreneurs (search for similar items in EconPapers)
JEL-codes: J24 J62 L25 L26 O52 (search for similar items in EconPapers)
Date: 2018
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