Are corporate affiliations conducive to nascent entrepreneurship?

Christian Hopp (), Gernot Pruschak () and Michel Krebs ()
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Christian Hopp: Bern University of Applied Sciences
Gernot Pruschak: Bern University of Applied Sciences
Michel Krebs: Bern University of Applied Sciences

International Entrepreneurship and Management Journal, 2024, vol. 20, issue 3, No 24, 2262 pages

Abstract: Abstract Founding an entrepreneurial venture does not comprise a dichotomous choice between market entry and non-entry; instead, a wide variety of entrepreneurial strategies are available to the nascent entrepreneur. Using data from the second Panel Study of Entrepreneurial Dynamics (PSED II), a representative sample of nascent entrepreneurial activity in the United States, this study documents that nascent entrepreneurs generally choose between founding an independent new venture and following a type of corporate-affiliated entrepreneurial strategy (CAES), such as a franchise, spin-off, or similar approach. The success of this decision is contingent upon entrepreneurs’ stock of human capital. Relevant industry experiences tend to reduce the likelihood of an entrepreneur employing a CAES, while managerial experience and previous start-up experience increases the probability. Overall, those nascent entrepreneurs who follow a CAES are more likely to achieve a first positive cash-flow; this highlights the benefits of corporate affiliations in the field of new venture founding.

Keywords: Nascent entrepreneurship; Endogeneity; Corporate support; Performance; Spin-offs (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1007/s11365-024-00998-y

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