Serial Entrepreneurship
Serial entrepreneurship refers to the
repeated behaviours of entrepreneur.
“There are two types of entrepreneurs: novice entrepreneurs, who launch a business for the first time, and habitual entrepreneurs, which include serial entrepreneurs, who launch businesses sequentially, and portfolio entrepreneurs, who run multiple businesses concurrently.” (Plehn-Dujowich, 2010)
Plehn-Dujowich suggests that serial
entrepreneurs differ substantially from first time entrepreneurs. They argue
that the serial entrepreneurs develop new capabilities over time that makes
them more effective entrepreneurs. For instance, they may develop heuristics
that guide their decision processes that reduce the analysis task needed to
assess risks. These types of advantage lead to equal or higher success rates
for serial entrepreneurs and a higher likelihood of sticking to
entrepreneurship as a career choice.
Serial entrepreneurship theory starts with
the idea that entrepreneurs need to decide whether to stay in business, leave
the business to start a new business, or leave the business to enter
employment.
The process of starting businesses then
exiting them to start new ones that seem even more promising is the serial
entrepreneur’s way. Each business is a stepping stone to the next, a means to
an end, not an end in itself. A policy implication that stems from the study is
that reducing the cost of shutting down a business is just as important as
reducing the cost of stating a new business.
Some scholars have argued that serial
entrepreneurship is temporal portfolio entrepreneurship since most
entrepreneurs would like to launch more than one business but may feel unable
to deal with more than one at a time. Perhaps entrepreneurs may prefer to learn
from each experience sequentially rather than deal with too many variables all
at once (Sarasvathy, Menon, & Kuechle, 2013).
Sources:
Plehn-Dujowich, J. (2010). A theory of serial entrepreneurship. Small Business Economics, 35(4), 377-398.
Sarasvathy, S. D., Menon, A. R., & Kuechle, G. (2013). Failing firms and successful entrepreneurs: Serial entrepreneurship as a temporal portfolio. Small business economics, 40(2), 417-434.
Plehn-Dujowich, J. (2010). A theory of serial entrepreneurship. Small Business Economics, 35(4), 377-398.
Sarasvathy, S. D., Menon, A. R., & Kuechle, G. (2013). Failing firms and successful entrepreneurs: Serial entrepreneurship as a temporal portfolio. Small business economics, 40(2), 417-434.
