Starting anew: Entrepreneurial intentions and realizations subsequent to business closure

Arbeitspapier

We know that most businesses fail. But what is not known is to what extent failed ex-entrepreneurs set up in business again. The objective of this article is to explore potential and realized serial entrepreneurship. Based on three disciplines - psychology, labour economics, and the sociology of careers - we formulated propositions to explain (potential) serial entrepreneurship. We tested these propositions empirically with a longitudinal database of 79 businesses that had closed within 5 years after start-up. A large majority of the ex-entrepreneurs maintained entrepreneurial intentions subsequent to business closure, while almost one in four business closures were followed by a new business (serial entrepreneurship). Our results show that the determinants of restart intention (potential serial entrepreneurship) and actual restart realization (realized serial entrepreneurship) are different. Ex-entrepreneurs who are young, who worked full-time in their prior business, and who recall their business management experience positively are likely to harbour restart intentions. Only 'being located in an urban region' transpired to have a significant effect on the start of a new business. Although entrepreneurial intentions are a necessary condition for the start of a new business, this study shows that the explanation of entrepreneurial intentions is distinct from the explanation of new business formation subsequent to business closure.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Papers on Entrepreneurship, Growth and Public Policy ; No. 1006

Classification and Topics

• Classification: Wirtschaft
• Subject: serial entrepreneurship ; business closure ; entrepreneurial intentions ; new business formation ; The Netherlands

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Schutjens, Veronique ; Stam, Erik
• Event: Veröffentlichung
• (who): Max Planck Institute of Economics
• (where): Jena
• (when): 2006

Further information

• Handle: http://hdl.handle.net/10419/24908
• Last update: 10.03.2025, 11:41 AM CET