The Journey From Novice To Serial Entrepreneurship In China And Germany

Description
In this particular brief description in relation to the journey from novice to serial entrepreneurship in china and germany.

The Journey from Novice to Serial
Entrepreneurship in China and Germany:
Are the Drivers the Same?
Sergey Anokhin
Dietmar Grichnik
Robert D. Hisrich
While in general entrepreneurs in emerging economies are signi?cantly
di?erent from entrepreneurs in mature markets on most dimensions,
serial entrepreneurs demonstrate certain similarities in their goals and
motivations, skills and competencies, resources, strategies and other
characteristics. The drivers governing the journey from novice to serial
entrepreneurship – while consistent with the arguments advanced by
Casson and Lazear – appear to di?er somewhat between emerging and
mature economies. Based on a cross-sectional survey of Chinese and
German entrepreneurs, the study contributes to the understanding of
entrepreneurship in emerging markets and extends the knowledge of
serial entrepreneurship by analyzing whether the di?erences between
serial and novice entrepreneurs can be attributed to the types of skills
and competences possessed by the individuals, and whether particu-
lar motives for starting new ventures are more conducive to multiple
business founding than others.
Key Words: serial entrepreneurship, emerging economies,
China, Germany
)vi Classi?cation: i
Introduction
Entrepreneurship is the main vehicle of economic development. Serial
entrepreneurship is its quintessential core. What makes certain individ-
uals but not others start multiple businesses (sometimes simultaneously)
Dr Sergey Anokhin is an Assistant Professor of Management
at the Kent State University, us..
Dr Dietmar Grichnik is a Professor for Entrepreneurship and Holder
of the Prof. Otto Beisheim Endowed Chair for Entrepreneurship
at the Otto Beisheim School of Management, Germany.
Dr Robert D. Hisrich is a Garvin Professor of Global Entrepreneurship
and Director of the Center for Global Entrepreneurship, Thunderbird
University, The Garvin School of International Management, us..
Managing Global Transitions o ): II,–I¡:
II8 Anokhin, Grichnik, and Hisrich
is an intriguing question. Only recently has this question drawn empiri-
cal attention, and the results to date are still modest although promising.
Existing literature attempts to explain the di?erences with the types of
start-up activities carried out during the gestation processes by nascent
entrepreneurs, their behavior patterns, personal backgrounds, experi-
ences, and resources under control (Alsos and Kolvereid I,,8; Rosa I,,8;
Ucbasaran, Wright, and Westhead o,; Van Osnabrugge I,,8; West-
head, Ucbasaran, and Wright o,; Westhead and Wright I,,8; Wright,
Robbie, and Ennew I,,,).
We extend these studies by suggesting that further selection of novice
entrepreneurs into serial/habitual entrepreneurs may be a function of
particular skill levels and competencies. Based on the arguments of Cas-
son (I,8 and Lazear oo¡), we hypothesize that entrepreneurs with
above-average levels of general skills such as in negotiating, presentation
and idea generation are more likely to start multiple ventures whereas
possessing above-average levels of functional skills, for instance in ?-
nance or marketing, would have no noticeable (or have a negative) e?ect
on the probability of becoming a serial entrepreneur. While prior litera-
ture has also suggested the importance of particular motives in the indi-
vidual’s decision to pursue an entrepreneurial occupation, relatively little
is known about particular individual goals of the serial entrepreneur. We
acknowledge the likelihood of di?erences in individual motives between
novice and serial entrepreneurs while leaving the directionality of such
di?erences to empirical investigation.
In international comparisons it must be taken into account that the
individuals’ characteristics, inclinations and motivations – such as pro-
clivity to start-up – are in?uenced by the institutional and cultural
background of the entrepreneurs’ country of origin (Hunt and Levie
o,; George and Zahra o:; Hofstede oI; Busenitz and Lau I,,o).
According to intercultural entrepreneurship research studies (Hayton,
George, and Zahra o, behavioristic phenomena like attitudes and
motivations are culture-speci?c, so that cross-cultural comparisons are
either aimed at inter-culturally valid phenomena, or require a context-
dependent result interpretation. This holds true especially for a cross-
sectional comparison between entrepreneurs in mature and emerging
markets, where institutional di?erences and their impact on human skills
and competencies are perhaps most salient. In this study, we account for
the entrepreneur’s country of origin when testing factors capable of af-
fecting a novice entrepreneur’s decision to move on to another venture,
Managing Global Transitions
The Journey from Novice to Serial Entrepreneurship II,
and also of developing a better understanding of the particularities of
the entrepreneurial processes in emergent markets. Chinese entrepre-
neurs are compared to their German counterparts (including separate
comparisons to East and West Germany) on a number of dimensions
covering a wide institutional range from the developing economy in
China to the highly developed economy in Germany, including the still
in transition after the reuni?cation of the Old and the New Laender
economy of East Germany.
Background and Hypotheses
The background and hypothesis will review the relevant research ?nd-
ings as an introduction to the development of the speci?c hypothesis to
be tested.
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There are di?erent de?nitions of multiple or habitual entrepreneurship
(Starr and Bygrave I,,I; Kolvereid and Bullvag I,,,; Birley and Westhead
I,,¡; Hall I,,,). Following Westhead and Wright (I,,8) we de?ne habit-
ual or multiple entrepreneurs as those owners-managers of businesses
who have either founded, purchased or inherited more than one ven-
ture, either sequentially (serial entrepreneur) or simultaneously (portfo-
lio entrepreneur). Novice entrepreneurs on the other hand, are those in-
dividuals that have no previous entrepreneurial experience as founders,
purchasers or inheritors of a business.
Following MacMillan’s (I,8o) call to study serial entrepreneurs in or-
der to learn more about entrepreneurship, a stream of research has fo-
cused upon several aspects of this phenomenon. So far there is growing
empirical evidence that multiple entrepreneurs do not constitute a ho-
mogeneous group in many respects (Ucsbasaran, Wright, and Westhead
o,). Regarding their motivations, there are two interesting issues. First,
although there is a considerable diversity among habitual entrepreneurs,
a pattern does seem to emerge. Serial entrepreneurs have been found to
be more concerned with personal development and pursuit of an idea
for a product (in some cases following a family tradition) than portfolio
entrepreneurs. Portfolio entrepreneurs, on the other hand, tend to report
more often the need for security and have an instrumental view of some
of the ventures in their portfolios, which were started in order to bene-
?t from tax exemptions. Novice and portfolio entrepreneurs seemed to
be more reactive, i. e. they reported more often than serial entrepreneurs
Volume ? · Number ? · Summer ????
I Anokhin, Grichnik, and Hisrich
‘the exploitation of an opportunity that appeared’ as a motivation. The
second interesting issue is that motivations of habitual entrepreneurs
seem to change between the ?rst and subsequent venture. While ?rst
ventures have been found to be motivated by ?nancial considerations,
second ventures have been found to be motivated by more personal rea-
sons (continue the challenge of owning a successful venture) and by se-
curity considerations (reduce risk exposure, take advantage of tax ex-
emptions). There is no clear evidence that novice, serial and portfolio
entrepreneurs di?er in terms of their ‘growth orientations’ and ‘materi-
alistic reasons’ (Rosa I,,8; MacMillan I,8o; Wright, Robbie, and Ennew
I,,,).
Ucbasaran, Wright and Westhead oo,) report a considerable mo-
tivational diversity among habitual entrepreneurs. The desire to work
independently was mentioned by every entrepreneur in this study as a
motivation for the ?rst venture and remained as the most frequently
reported motivation for subsequent ventures. Financial motivation was
emphasized especially in the case of ?rst ventures. This held not only
for di?erent types of entrepreneurs but also for each type over time. Re-
garding subsequent ventures, more personal reasons were given as mo-
tivation to start new businesses, such as the desire to continue the chal-
lenge of owning a successful venture. Starter entrepreneurs were more
likely than acquirer entrepreneurs to strive for independence and auton-
omy. Habitual starter entrepreneurs were also more likely to be proactive
searchers of business opportunities, whereas acquirers, who stressed the
importance of networks, tended to be more reactive and used the net-
works as the providers of business opportunities. Motivations were also
found to vary with the type of venture owned by habitual entrepreneurs.
Westhead, Ucbasaran and Wright oo,) provide support that habitual,
either serial or portfolio entrepreneurs are more likely than novice entre-
preneurs to stress organizational routines oriented towards innovation,
growing the business and professional management. Portfolio entrepre-
neurs were more likely to focus upon managerial competence and hu-
man capital resources. They were also more likely to show higher levels
of competences that provide a greater understanding of why and how
they own several businesses at the same time.
Westhead and Wright’s (I,,8) novice entrepreneurs were more likely
than serial entrepreneurs to be motivated by the ‘need of independence’
and they were more likely than portfolio entrepreneurs to have reported
the ‘need for approval’ as a motivation to start a venture. However, they
Managing Global Transitions
The Journey from Novice to Serial Entrepreneurship I:I
were less likely than habitual entrepreneurs to have started a business to
‘continue a family tradition’ (‘follow role models’). Habitual founders
were more likely than novice founders to have emphasized ‘perceived in-
strumentality of wealth’ and ‘need for personal development’ as reasons
for start-up. Portfolio founders were on the other hand, more likely than
novice and serial founder to stress ‘security’ (‘perceived instrumentality
of wealth’) and ‘to have access to indirect bene?ts such as tax exemp-
tions’. Serial founders were more likely than novice entrepreneurs to be
motivated by the willingness to ‘develop an idea for a product’ (‘need for
personal development’). However, they were less likely than the others
to have reported ‘to have more in?uence in my community’ as a rea-
son for starting a venture. Westhead and Wright do not ?nd support for
the hypothesis that portfolio and serial founders were more growth ori-
ented than novice founders. Birley and Westhead (I,,¡) found that mul-
tiple (portfolio and serial) entrepreneurs were more likely than novice
entrepreneurs to emphasize materialistic reasons for starting a venture,
whereas Westhead and Wright (I,,8) found that portfolio founders were
more likely than serial founders to have stated this reason. They provide
further support that habitual entrepreneurs can not be treated as a ho-
mogeneous group.
Rosa (I,,8) determined that the process of multiple business owner-
ship is an entrepreneurial one. According to his research, subsequent new
ventures were not typically driven by managerial considerations alone.
Even when some founding was motivated by the need to exploit tactical
advantages or to deal with ?nancial di?culties, entrepreneurial added
value was always involved. Regarding the construction of generic types
of entrepreneurs, Rosa felt that the diversity often exhibited by entrepre-
neurs over time in terms of their motivations and strategies for starting
each new venture makes it di?cult to construct a typology of habitual
entrepreneurs. He does not ?nd clear evidence to support the construc-
tion of a mapping fromhomogeneous types to entrepreneurial behavior.
Wright, Robbie and Ennew (I,,,) postulate that there are no obvious
reasons to expect the motivations, personal characteristics and behavior
of serial founders to be less diverse than those of novice founders. The
motivations stated by the subjects in their study ranged from the desire
for independence and autonomy, frustration with the present job to a
sense of duty and the desire for wealth creation. Motivations are also
found to change over time. For instance, in cases where monetary gain
was perceived as an important factor in the ?rst venture, it was consid-
Volume ? · Number ? · Summer ????
I:: Anokhin, Grichnik, and Hisrich
ered less important in the second. The desire for a challenge and/or to de-
velop an idea was very strong in the case of second and subsequent ven-
tures. The desire to reduce the exposure to ?nancial risk was present as
well. And even if entrepreneurs committed a smaller proportion of their
personal wealth in subsequent ventures, they emphasized the importance
of being personally committed to them. This study also found that previ-
ous entrepreneurial experience in?uenced the way in which subsequent
ventures were undertaken. For instance, some individuals were reluctant
in further ventures to risk their reputation as successful entrepreneurs.
Empirical studies have failed so far to identify signi?cant di?erences
in performance between novice and multiple founders and between the
two types of habitual founders (Kolvereid and Bullvag I,,,; Wright, Rob-
bie, and EnnewI,,,; Westhead and Wright I,,8). Rosa (I,,8) also asserts
that it is empirically open und unresolved how far aggregate value (i. e.
the sumof all employment, sales turnover, and capital assets) in the clus-
ter of ?rms created by habitual entrepreneurs outperforms that of the
single ?rm entrepreneurs.
Regarding the lack of conclusive ?ndings, Westhead and Wright (I,,8)
indicate that ‘there is a need to take note of the heterogeneity of types
of entrepreneur and to consider the entrepreneur as the appropriate
unit of analysis rather than simply the ?rm’. They also assert that fur-
ther research should focus upon the entrepreneur as a unit of analysis
to allow a better understanding of the nature and contribution of en-
trepreneurship. They claim that ‘the organization should not be the sole
unit of analysis, because some entrepreneurs attempt to resolve their per-
sonal materialistic aspirations through the growth of a portfolio of busi-
nesses’ (Birley and Westhead I,,¡). MacGrath (I,,,) and Sarasvathy and
Menon oo con?rm this when they suggest that ?rms have an instru-
mental role in the career of an entrepreneur. Rosa (I,,8) also asserts that
the snap shot approach of just comparing the latest (habitual) and new
venture (the novice) is incomplete and can lead to premature evaluation
of the relative contribution of these types of entrepreneurs to economic
development.
Cultural particularities can also help explain di?erences in entrepre-
neurial activities (McClelland I,oI). To grasp the cultural context on a
national level (Ulijn and Brown o¡; Ulijn and Fayolle o¡) most stud-
ies draw on Hofstede’s cultural concept (Hofstede oI). Following Hof-
stede’s de?nition of culture as the ‘collective programming of the mind
which distinguishes the member of one human group from another’
Managing Global Transitions
The Journey from Novice to Serial Entrepreneurship I:,
(Hofstede I,,I, ,), the cultural context can be seen as a sounding board
for entrepreneurship by predisposing entrepreneurial behavior psycho-
logically via attitudes, beliefs and the motivation of the entrepreneur and
sanctioning entrepreneurial activities socially via common shared values
and norms within a society (Hunt and Levie o,). Hayton, George, and
Zahra oo identify in a meta-analysis a positive impact of Hofstedes’
cultural dimensions on entrepreneurship in high levels of individualism
and masculinity and low levels of power distance and uncertainty tol-
erance. Though the latter provides a direct link to human resources in
emerging and mature markets, recent literature indicates that Hofstedes’
cultural dimensions were developed for established companies and are
not speci?c enough for new ventures (Busenitz, Gomez, and Spencer
oo). These recent studies (Busenitz and Lau I,,o; Tan o suggest
a separation of the cultural background and cognitive dispositions and
human characteristics for a better understanding of their impact on en-
trepreneurial behavior. Following the results of this research, goals and
motivation, skills and competencies are considered in this study as en-
dogenous and the cultural context as an exogenous determinant of serial
entrepreneurship.
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The hypotheses concerning di?erences between serial and novice entre-
preneurs attributed to the types of skills and competences possessed by
the individuals are based, in part, on the arguments of Casson (I,8 and
Lazear oo¡).
Casson (I,8 de?nes an entrepreneur as somebody who specializes in
taking judgmental decisions about the coordination of scarce resources
and proposes a set of skills required by decision making. These consist of
self-knowledge (or knowledge of the principal’s objectives), imagination,
practical knowledge, analytical ability, search skill, foresight, computa-
tional skill and communication skill (in formulating instructions). Cas-
son infers that the entrepreneur needs to be more a generalist rather than
a specialist and formulates that it is important to be reasonably good at
all aspects of decision making instead of being very good at some and
bad at others. However, not all of these qualities are equally important,
nor are they equally distributed among the population. Those unequally
distributed will have a considerable economic importance and will be
peculiar to the entrepreneur. Some of these skills are almost innate, such
as imagination, but most are capable of enhancement, either by training
Volume ? · Number ? · Summer ????
I:¡ Anokhin, Grichnik, and Hisrich
or experience. The crucial point is that somebody who wants to become
an entrepreneur will have to be pro?cient in many aspects (or extremely
good at delegating and organizing).
Lazear oo¡) o?ers a model explaining why this may indeed be the
case. He ?rst assumes that people are endowed with some basic talents
regarding two¹ di?erent skills and that they can augment these by ac-
quiring certain types of human capital. He then introduces two types of
income functions that he assigns respectively to specialists and entrepre-
neurs. These functions are mappings from skills to income. The income
of the specialists equals the value of the skill with the highest level. The
income of the entrepreneurs on the other hand, is determined by the
value of the skill with the lowest level. Investment in human capital to
augment the skill levels is costly.- If individuals are born with di?erent
levels of talent concerning both skills, then for di?erent arrangements
of the parameters, depending on whether they have the income func-
tion of a specialist or that of an entrepreneur, they may adopt di?erent
investment strategies. Individuals, who have the income function of a
specialist, have an incentive to invest in one of the skills to maximize re-
turns. On the other hand, individuals who have the income function of
an entrepreneur, have an incentive to invest in this skill up to the level of
the other and afterwards they optimize by investing in human capital to
reach a similar level of talent in both skills.³ Because investment in hu-
man capital is costly and the cost function is convex, there will be a limit
to the optimum level of skills and therefore a limit to the increment of
income derived from them. We hypothesize that serial entrepreneurship
can provide a way to boost this process.
To summarize these thoughts we agree with Casson (I,8 that self-
selection into entrepreneurship could be a function of skills and compe-
tences possessed by an individual. In particular, individuals with general,
not functional skills are more likely to start new businesses; those with
high functional skills (e. g. ?nances) are more likely to choose profes-
sional careers. In terms of Lazear’s oo¡) statements that entrepreneurs
are expected to have a more balanced set of skills than non entrepreneurs,
and that serial entrepreneurs can be seen as novice entrepreneurs who are
committed to the career, we extend these arguments by suggesting that
further selection of novice entrepreneurs into serial/habitual entrepre-
neurs may be a function of the levels of particular skills and competen-
cies. In particular, we hypothesize that entrepreneurs with above-average
levels of general skills (e. g. oral presentation, writing ability, idea gener-
Managing Global Transitions
The Journey from Novice to Serial Entrepreneurship I:,
ation) are more likely to start multiple ventures whereas above-average
levels of functional skills (e. g. human resource management, ?nance,
marketing) would have no noticeable (or ever have a negative) e?ect on
the probability of becoming a serial entrepreneur. Thus, our two main
hypotheses are:
uI Novice entrepreneurs with higher levels of general skills are more
likely to start multiple ventures.
u: Novice entrepreneurs with higher levels of functional skills are less
likely (or not signi?cantly more likely) to start multiple businesses.
Prior literature – as shown in the background review (Ucbasaran,
Wright, and Westhead o,, Westhead and Wright I,,8; Wright, Rob-
bie, and Ennew I,,,) – has also suggested the importance of particular
motives in the individual’s decision to pursue an entrepreneurial occu-
pation. At the same time, relatively little is known about particular indi-
vidual goals in the serial entrepreneurship context. We acknowledge the
likelihood of di?erences in individual motives between novice and se-
rial entrepreneurs while leaving the directionality of such di?erences to
empirical investigation leading to the following hypothesis:
u, Entrepreneur’s goals and motives signi?cantly di?er between novice
and serial entrepreneurs.
To address the impact of the cultural environment on the role of hu-
man resources in entrepreneurial ventures, we control for the country
of origin. Previous literature – as shown above (Hunt and Levie o,;
George and Zahra o:; Hofstede oI; Busenitz and Lau I,,o) – in-
dicates apparent cultural di?erences between entrepreneurs in transi-
tion and developed economies. Accordingly, since cultural environment
is looked at in the literature as an exogenous component a?ecting en-
trepreneurship, we expect ‘average’ entrepreneurs in emerging and ma-
ture economies to demonstrate signi?cant di?erences on most char-
acteristics and attributes. At the same time, as we conceptualize serial
entrepreneurs as ‘ultimate venturers’ committed to their entrepreneurial
careers and having comparably composed sets of skills and competen-
cies regardless of their national origin, we expect serial entrepreneurs to
demonstrate signi?cantly more similarities with respect to their char-
acteristics and attitudes such as motivations, strategies, and resources.
These results are re?ected in the ?nal two hypotheses:
u¡ Most characteristics and attitudes signi?cantly di?er between Chi-
nese and German entrepreneurs.
Volume ? · Number ? · Summer ????
I Anokhin, Grichnik, and Hisrich
u, Compared to ‘average’ entrepreneurs, serial entrepreneurs in China
and Germany show more similarities with respect to their motiva-
tions, strategies, characteristics and resources.
To test these hypotheses, the following methodology was applied.
Methodology
The methodology will be discussed in terms of the data, the variables,
and the data analysis methods. The data of our hypotheses are tested
based on cross-sectional data collected in Germany and China. The ques-
tionnaire used was based on a previously validated instrument originally
developed by Hisrich and his co-authors and used in a number of studies
in a range of economies including Israel, Russia, Ukraine, and the United
States (Hisrich and Grachev I,,,; Lerner, Brush, and Hisrich I,,,). It was
translated into German and Chinese and administered to German and
Chinese entrepreneurs. The list of questions used is available from the
authors. Out of ,I, returned questionnaires (seventy percent from Ger-
many and thirty from China), ,, were deemed unusable since respon-
dents indicated their position as managerial rather than entrepreneurial
resulting in a ?nal sample of :,o responses.
8:.I percent of Chinese entrepreneurs in the sample were males com-
pared to ,,.o percent in Germany. The age of Chinese entrepreneurs var-
ied from :¡ to ,, years with the mean being ,,. German entrepreneurs
were ?ve years older on average (¡ with reported age varying form:, to
o, years. Io.o percent of German entrepreneurs reported having started
more than one venture (serial entrepreneurs) compared to I:., percent
in China.
v.vi.nivs
Our dependent variable – serial entrepreneur – was coded I if the en-
trepreneur indicated that the current business was not his ?rst en-
trepreneurial venture and coded o otherwise. We tested :, independent
variables as potential predictors of becoming a serial entrepreneur. In
particular, we examined Io items of the entrepreneur’s goals/motivations
(personal achievement, status and prestige, economic necessity, ?exibil-
ity in work/family, independence, learning and personal growth, desire
to test one’s own ideas, money and wealth, recognition, and satisfying
work relationships); 8 items of functional skills (?nance, human re-
source management, marketing, operations, organizing and planning,
problem analysis/solving, information systems, technology); and , items
Managing Global Transitions
The Journey from Novice to Serial Entrepreneurship I:,
of general competencies (negotiating, idea generation, oral presenta-
tions, writing ability, quantitative competencies, motivating employees,
developing personal business relationships). We included entrepreneurs’
age, gender and country of origin dummies as controls. For the cross-
cultural comparison between Germany (East and West) and China, ¡
items in job satisfaction, items in resources, II items in strategy and
Io items in industry characteristics were included.
u.1. .x.issis xv1uou
Descriptive statistics and bivariate correlations are presented in table I.
Given the binary coding of the dependent variable, the most appropri-
ate estimation technique is binary logistic regression (models I–¡, table
. Model I only includes control variables. Model : adds entrepreneurs’
goals and motivations to the set of predictors. Model , builds on model :
by adding general competencies to the equation, and model ¡ augments
the set of predictors with functional skills.
We acknowledge that due to the limited sample size, a relatively small
proportion of serial entrepreneurs in the sample, and substantial num-
ber of independent variables, we may not achieve statistical signi?cance
for some coe?cients even if the proposed relationships hold true. Nev-
ertheless, we were reluctant to deliberately oversample particular groups
of individuals (serial entrepreneurs) so as not to distort the underlying
properties of the sampled population. Instead, we resorted to a non-
parametric resampling technique known as bootstrap to check whether
relationships reported by the logistic regression as signi?cant are a mere
artifact of the sample size or re?ect true properties of the data at hand
(Bollen and Stine I,,:; Efron and Gong I,8,; Stine I,8,). By doing so
we make an assumption that our sample is representative of the over-
all population, which appears to be the case. Otherwise, the bootstrap
results are only generalizable to this particular sample. To arrive at boot-
strap estimates, :,o random samples were drawn with replacement from
the original dataset (that is, some observations are likely to appear in
more than one sample) each of which is used to re-test our initial model.
The resulting coe?cients for each regression are then averaged over the
:,o regression runs. The standard deviation of each coe?cient is then
divided by the square root of the sample size to arrive at the standard
error of the mean. A t-value is then estimated for each coe?cient by
comparing the coe?cient’s average to its standard error. Bootstrap esti-
mates are only used to con?rm the relationships rendered as signi?cant
Volume ? · Number ? · Summer ????
I:8 Anokhin, Grichnik, and Hisrich
1.niv I Descriptive statistics
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xo1vs I – serial entrepreneur, : – personal achievement, , – status and prestige, ¡ –
economic necessity, , – ?exibility in work/family, o – independence, , – learning and
personal growth, 8 – test my own ideas, , – money and wealth, Io – recognition, II –
satisfying work relationships, I: – ?nance, I, – human resource management, I¡ – mar-
keting, I, – idea generation, Io – operations, I, – organizing and planning, I8 – managing
information systems, I, – technology, Continued on the next page
Managing Global Transitions
The Journey from Novice to Serial Entrepreneurship I:,
1.niv I Continued
I, I¡ I, Io I, I8 I, :I :: :, :¡ :, :, :8
.I:
.oI .¡,
.I, .:, .:¡
.:, .:, .:, .::
.I¡ .II .II .I: .,:
.o, .o: .o, .I: . .o¡
.I, .:, .:I .I, .I, .:, .I,
.I¡ .I, .I¡ .o, .II .I: .I: .¡¡
.I, .o8 .o: .I: .I, .o, .Io .:I .:8
–.oI .I, .I, .oo .:I .I, .I8 .I, . .:8
.I¡ .I, .Io .Io .:, .:8 .:: .:, .I8 .I, .:,
.,8 .o, .o, .o¡ .:8 .:I .Io .:, .Io .I¡ .o, .I,
.Io .Io .Io –.o: .:, .:¡ .Io .,, . .o, .I: .I, .,:
.oo –.Io –.o, .o¡ .oo .o, .o8 –.o¡ –.o, –.oI –.I¡ .o, .oI –.o:
–.o¡ .oI .o8 –.o, .o, .I, .I, .Io .o8 –.o, .I: .Io –.o: .o¡ –.o¡
–.o8 .:I .I: –.o, .o¡ .:I .I¡ .:8 .:: .I: .:, .o, .:I .:, –.:, .oo
– negotiating, :I – oral presentation, :: – writing ability, :, – problem analy-
sis/solving, :¡ – quantitative competence, :, – motivating employees, – developing
personal business relationships, :, – age, :8 – gender, :, – China –II – motivations,
I:–:, – skills and competencies). Correlations with absolute value greater than o.o, are
signi?cant at p <o.Io level, o.II are signi?cant at p <o<.o, level, o.I, are signi?cant at
p <o<.oI level, o.I, are signi?cant at p <o<.ooI level.
Volume ? · Number ? · Summer ????
I,o Anokhin, Grichnik, and Hisrich
1.niv : Regression results (dependent variable – serial entrepreneur)
Variable or statistic (I) ) (,) (¡) (,) (o) (,)
Functional skills
Finance o.Io
(o.)
Human resource management –o.o,
a
(o.,,)
Yes Yes
Marketing o.:8
(o.:,)
Operations –o.oI
(o.:8)
Organizing and planning –o.
(o.,o)
Positive
a
Problem analysis/solving –o.,,
b
(o.,o)
Yes Yes
Managing information systems o.,,
b
(o.:,)
Yes Yes Negative
b
Technology –o.:,
(o.:,)
General Competencies
Negotiating o.,o
(o.,¡)
o.:8
(o.,,)
Idea generation –o.o8
(o.I,)
–o.:¡
(o.:¡)
Oral presentation o.,I
a
(o.,8)
I.oI
b
(o.¡,)
Yes Yes Positive
a
Writing ability o.:,
(o.:,)
o.,,
a
(o.,I)
Yes Yes
Quantitative competence o.II
(o.:,)
o.I¡
(o.,I)
Motivating employees o.:8
(o.,8)
o.,,
(o.¡,)
Developing personal business relationships –o.¡¡
(o.:,)
–o.o,
b
(o.,
Yes Yes
Goals and Motivations
Personal achievement o.o,
(o.:8)
o.oo
(o.,o)
o.:,
(o.,,)
Status and prestige o.¡:
a
(o.)
o.,¡
a
(o.:8)
o.¡,
(o.:8)
Positive
a
Continued on the next page
Managing Global Transitions
The Journey from Novice to Serial Entrepreneurship I,I
1.niv : Continued
Variable or statistic (I) ) (,) (¡) (,) (o) (,)
Economic necessity –o.,¡
(o.:,I)
–o.:I
(o.)
–o.:,
(o.:8)
Flexibility in work/family o.oo
(o.:,)
o.o,
(o.:¡)
–o.oI
(o.:,)
Positive
a
Independence –o.oI
(o.:,)
–o.o¡
(o.:,)
–o.Io
(o.,I)
Learning and personal growth –o.¡,
(o.:,)
–o.,I
a
(o.,I)
–o.,,
b
(o.,o)
Yes Yes Negative
a
Test my own ideas o.:,
(o.:8)
o.,¡
(o.,o)
o.,o
(o.,,)
Money and wealth –o.:,
(o.)
–o.,I
(o.:8)
–o.,,
(o.,
Recognition o.o,
(o.,I)
o.o,
(o.,,)
o.::
(o.,,)
Satisfying work relationships –o.,o
(o.)
–o.¡,
a
(o.:,)
–o.,:
a
(o.,
Yes Yes Negative
b
Controls
Age o.o,
(o.o,)
o.o:
(o.o,)
o.o,
(o.o,)
o.o:
(o.o,)
Gender o.o,
(o.,o)
o.,o
(o.oo)
o.¡,
(o.o,)
o.,,
(o.o,)
China o.¡o
(o.¡,)
o.o,
(o.,o)
–o.:¡
(o.o
–o.¡o
(o.,
Constant –,.,o
c
(I.:I)
–I.:,
.:,)
–,.:,
a
.,,)
–,.,,
(,.o8)
Nagelkerke R
2
o.o: o.II o. o.:8
Change in R
2
– o.o, o.o, o.o8
xo1vs Column headings are as follows: (I) model I, ) model :, (,) model ,, (¡)
model ¡, (,) relationship con?rmed – Ioo runs bootstrap, (o) relationship con?rmed
– :,o runs bootstrap, (,) interaction with ‘China’. Standard errors in parentheses.
a
p <o.Io,
b
p <o.o,,
c
p <o.oI,
d
p <o.ooI.
by the initial logistic regression and are not used to claim support for
our hypotheses if only the bootstrapped but not the initial results show
signi?cance. Two columns in table : indicate whether or not model ¡
results are con?rmed by the bootstrap testing based on Ioo and :,o ran-
dom samples.
To obtain a better understanding of di?erent characteristics and atti-
Volume ? · Number ? · Summer ????
I,: Anokhin, Grichnik, and Hisrich
tudes of Chinese entrepreneurs, we also compare them to the subsam-
ples of West and East Germany-based entrepreneurs. These comparisons
were made for the broad population of average entrepreneurs and for
the smaller group of serial entrepreneurs (see table ,). For the latter the
last column in table : indicates a positive or negative interaction of the
results in models I–¡ with China country membership. Table , shows
the extended analysis of di?erences among average and serial entrepre-
neurs from China, East and West Germany. In addition to comparing
the above mentioned goals and motivations, skills and competencies, we
include several items on job satisfaction, resources, strategy and indus-
try characteristics into consideration to fully illustrate the di?erences be-
tween emerging and mature environments within which entrepreneurs
operate.
Findings
The ?ndings are mostly based on model ¡, our main model. As suggested
by the Hosmer and Lemeshowtest, binary logistic regression ?ts the data
adequately. The : of I:.I¡ is not signi?cant (p =.I,), indicating accept-
able ?t. The Nagelkerke R
2
is .:8, and overall the model correctly clas-
si?es ,o.,% of entrepreneurs. The large number of di?erent measures
of entrepreneur’s motivations and competencies can potentially create a
multicollinearity problem. However, the diagnostics did not reveal any
indications of this problem; the largest viv is only :.o,. The highest cor-
relation between independent variables is .,: between two general com-
petences (motivating employees and developing personal business rela-
tionships), which is well below the ., threshold. Since our study employs
a cross-sectional design with the answers being self-reported, there is a
potential threat of a common method bias. If this were the case, such
bias would have manifested itself in the correlation table, and the ob-
served correlation between theoretically uncorrelated constructs would
have re?ected it. Since the smallest correlation is .oo, this implies that
even if the common method bias is present, its magnitude is negligible.
As our results indicate, general skills are successful in explaining the
probability of a novice entrepreneur becoming a serial entrepreneur.
Thus, both superior oral presentation and writing ability are posi-
tively associated with the start of multiple future ventures by a novice
entrepreneur.? This lends support to hypothesis I. Negotiating, quanti-
tative competence, and employee motivating skills do not di?erentiate
novice from serial entrepreneurs. Contrary to our expectations, a com-
Managing Global Transitions
The Journey from Novice to Serial Entrepreneurship I,,
1.niv , Means comparison: China to Germany; China to West Germany;
China to East Germany
Entrepreneurs Serial entrepreneurs
(I) ) (,) (¡) (I) ) (,) (¡)
Goals and motivations
Personal achievement ¡.:, ¡.:8 ¡.¡, ¡. ¡.o8 ¡.:, ¡.,o ¡.I¡
Status and prestige ,.¡I :.8¡
c
:.8I
b
:.8,
c
,.o: ,.o,
a
,.,8 :.8,
b
Economic necessity ,.,I ,.,, ¡.I, ,.,8 ,.,, ,.o8 ,.,, ,.o¡
Flexibility in work/family ,.oo ¡.o,
b
¡.o¡
a
¡.o:
b
,.,: ,.8o ¡.:, ,.o¡
Learning and personal growth ¡.Io ¡.oI ¡.I, ,.,o ¡.oo ,.8o ¡.:, ,.o¡
Test my own ideas ¡.:, ,.8,
c
,.,:
c
,.,:
c
¡.o8 ¡.o, ¡.:, ,.,,
Money and wealth ,.8o ,.¡:
c
,.I,
c
,.,,
b
,.8, ,.:,
b
:.88
b
,.¡,
Recognition ¡.o, ,.,,
c
,.o8
b
,.¡,
d
¡.oo ,.,, ,.,, ,.¡,
Satisfying work relationships ,.,, ¡.II
b
¡.o,
a
¡.II
b
,.,o ¡.oo ,.88 ¡.o,
Skills and competencies
Finance :.8o ,.I¡
a
,.::
a
,.Io ,.:I ,.:, ,.I, ,.:,
Dealing with people ,.oI ,.,, ,.8, ,.,I ,.¡I ,.o¡ ¡.oo ,.¡,
Marketing ,.o8 ,.I,
c
,.
b
,.Io
c
,.¡o ,.,: ,.,, ,.o,
Idea generation ,.,, ,.,,
b
,.,o
a
,.¡I
a
,.,¡ ,.,o ,.,8 ,.,,
Operations ,.,8 ,.,, ,.,: ,.,, ,.¡¡ ,.¡, ,.,I ,.:,
Organizing and planning ,.,, ,.o¡ ,.o¡ ,.o, ,.¡o ,.,: ¡.I¡ ,.¡o
Managing information systems ,.,, :.8o
d
:.8,
c
:.8o
d
,.,, ,.,o ,.:, ,.¡,
Technology ,.,, ,.oo
b
:.,o
a
,.oo
b
,.,I ,.o, ,.:, :.,,
Negotiating ,.8o ,.:¡
d
,.,o
c
,.:,
d
,.,¡ ,.¡, ,.,, ,.:,
Oral presentation ,.8o ,.¡o
d
,.oo
a
,.¡,
d
,.o: ,.,, ,.88 ,.o¡
Writing ability ,.¡o ,.:I
b
,.¡, ,.I,
b
,.8, ,.¡I
a
,.,, ,.:I
b
Problem analysis/solving ¡.o: ,.¡,
d
,.¡,
d
,.¡,
d
,.,, ,.¡I ,.:, ,.,o
Quantitative competence
(math skills)
,.,, ,. ,.:: ,. ,.,: ,.¡, ,.:, ,.,,
Motivating employees ,.,I ,.:¡
d
,.:,
c
,.:¡
d
,.:8 ,.:, ,.,o ,.I¡
Developing personal business
relationships
,.,8 ,.
d
,.::
d
,.:,
d
,.8: ,.:,
b
,.,, :.,,
c
Satisfaction
Satis?ed with how I do my job ,.¡8 ¡.I,
d
,.,8
c
¡.I,
d
,.o, ¡.o, ¡.:, ¡.oo
Satis?ed with the income I earn ,.o, :.8o :.oI
b
:.,, ,.:8 :.,I :.,8
b
,.:I
Continued on the next page
Volume ? · Number ? · Summer ????
I,¡ Anokhin, Grichnik, and Hisrich
1.niv , Continued
Entrepreneurs Serial entrepreneurs
(I) ) (,) (¡) (I) ) (,) (¡)
Satis?ed with the people who
work for/with me
,.¡o ,.8o
c
,.,,
a
,.8o
c
,.oo ,.,o
b
,.,I ,.o,
a
Satis?ed with the future prospects
of this company
,.,, ,.o,
d
:.,8
d
,.I,
c
,.¡I :.,,
b
:.,8
c
:.,,
Resources
Technological and computer
equipment
:.I8 ,.,o
d
,.8,
d
,.oo
d
I.8, ,.,,
d
¡.,8
d
,.I¡
d
Business facilities and o?ces :.8o ,.,o
d
,.,¡
d
,.¡,
c
:.,o ,.,,
d
,.,o
b
,.o¡
c
Business location :.,o ,.¡,
d
,.,I
d
,.¡o
d
:.,¡ ,.,:
c
,.¡,
a
,.,,
c
Operating/manufacturing plant
and facilities
:.oo :.,¡ :.,o :.,¡ :.,, :.,, :.,o :.8o
Cash/liquidity :.oo :.,o :.,8 :.,: :.,: :.,, I.88
a
:.,,
Experienced workforce :.,¡ ,.o:
d
,.,¡
d
,.,:
d
:.8: ,.¡,
b
,.,o ,.¡,
Customer relationships :.oI ¡.Io
d
¡.o¡
d
¡.II
d
:.o: ¡.o,
d
¡.oo
c
¡.I¡
d
Cost e?ciencies :.8: ,.I,
b
,.I, ,.I,
b
:.,: ,.oo :.,, ,.I¡
Innovation capability :.,, ,.¡I
d
,.I,
a
,.,:
d
:.o, ,.:,
a
,.oo ,.¡,
a
Flexibility/ability to adapt ,.o: ,.8:
d
,.8o
d
,.8,
d
,.o, ,.,,
c
,.,,
a
,.,I
b
Reputation/image :.,, ¡.o:
d
,.,o
d
¡.o,
d
:.¡I ¡.oo
d
,.88
c
¡.o,
d
Expertise/knowledge of employees :.oo ,.o,
d
,.8I
d
,.,:
d
:.,¡ ,.,,
c
,.,,
b
,.,o
b
Shared purpose/values among
employees
:.,, ,.o, ,.o8 :.,o :.,: ,.:¡ ,.,I
a
,.oo
Partnerships/alliances :.,, :.¡I :.,¡ :.¡, :.8, ,.I8 :.88 ,.,o
Access to debt ?nancing ,.o¡ :.¡I
c
:.:,
c
:.,,
b
:.,, :.¡o :.I,
a
:.,8
Access to equity ?nancing :.oo :.,, :.,, :.,, ,.oo :.¡, :.,8 :.¡o
Access to quali?ed employees
labor force
,.,: :.o:
d
:.,,
c
:.,¡
d
,.o, ,.Io ,.,8 :.,:
Access to market information ,.o8 ,.¡o ,.¡o ,.,: ,.o, ,.¡, ,.,8 ,.¡o
Access to technology ,.¡o ,.¡o ,.¡¡ ,.,: ,.¡o ,.I¡ ,.I, ,.I,
Access to distribution channel ,.o¡ :.o,
d
:.¡o
d
:.,,
d
,.o¡ :.,,
c
:.,8
b
:.o,
b
Strategy
Quality control ¡. ¡.I8 ¡.,, ¡.I¡ ¡.,o ¡.:, ¡.I, ¡.:,
Satisfaction of customer needs ¡.II ¡.,I
d
¡.,,
c
¡.¡8
c
¡.I8 ¡.¡, ¡.,8 ¡.,o
Product/service development
innovation
,.,8 ,.oI
c
,.¡,
c
,.o,
b
,.,o ,.,, ,.o, ,.,,
Continued on the next page
Managing Global Transitions
The Journey from Novice to Serial Entrepreneurship I,,
1.niv , Continued
Entrepreneurs Serial entrepreneurs
(I) ) (,) (¡) (I) ) (,) (¡)
Innovative marketing ,.8: ,.o,
d
,.o:
d
,.o8
d
,.8: ,.I8
b
,.o, :.,,
c
Quality service/product ¡.I8 ¡.Io ¡.I, ¡.o8 ¡.I8 ¡.o, ,.,, ¡.:I
Customer service ,.8, ¡.o, ¡.o, ¡.o, ,.8: ,.,I ¡.oo ,.8o
Partnerships/alliances ,.,8 :.oI
d
:.,,
b
:.,,
d
,.o: ,.oo
a
,.:, :.8o
b
Cost reduction ,.8o ,.,I
b
,.o¡ ,.¡I
b
,.,, ,.,, ,.88 ,.,I
Technological innovation ,.8: ,.I,
d
,.,I
b
,.I¡
d
,.8: :.8o
c
,.oo
b
:.,,
c
First with new products/service ,.,, :.8I
d
:.,8
d
:.8,
d
,.,¡ :.8o
c
,.:, :.o¡
c
Operational e?ciency and
employee productivity
,.8o ,.:,
d
,.¡o
b
,.
d
,.,, ,.¡, ¡.I, ,.o,
b
Industry characteristics
Growth :.,I :.I8
a
:.:, :.Io
a
:.:I :.¡I :.,, :.:I
Number of competitors ,.I8 :.,,
d
:.,,
c
:.,8
d
,.I8 :.o8
a
:.88 :.,,
a
State regulation :.,, I.,:
d
I.,I
d
I.,¡
d
:.o, :.:¡ :.,8 :.I,
Foreign competitors ,.I¡ I.I8
d
I.oo
d
I.:,
d
,.I8 I.,,
c
I.88
b
I.o,
c
Speed of technological change ,.:, :.,8
c
:.o:
d
:.8o
a
:.,o :.,o :.o, :.8,
Ease of new company entry
into industry
,.:, :.8,
b
:.,:
c
,.oI ,.oo ,.,,
a
,.,o ,.,,
a
Supplier pricing ,.o, :.,o
c
:.:I
d
:.o:
c
:.,: :.o8 :.,8 :.8o
Retailer pricing ,.II :.:I
d
:.o8
d
:.:8
d
:.,, :.,, :.88 :.o¡
Customer demand :.o, ,.o8
c
:.,8
a
,.II
c
:.o¡ :.,, :.o, ,.I¡
Substitute products/services ,.,, :.oI
d
I.,,
d
:.I,
d
,. :.o8
a
:.o, :.,I
xo1vs Column headings are as follows: (I) China, ) Germany, (,) West Germany,
(¡) East Germany.
a
p <o.Io,
b
p <o.o,,
c
p <o.oI,
d
p <o.ooI.
petence in developing personal business relationships is negatively re-
lated to the probability that a novice entrepreneur would start another
venture. This is further examined in the discussion section.
Relationships between human resource management skills and analyt-
ical and problem solving competencies are negatively related to the de-
pendent variable. None of the other functional skills (?nance, marketing,
operations, organizing and planning, technological expertise) are signif-
icantly di?erent between novice and serial entrepreneurs. These ?ndings
support hypothesis :. At the same time, entrepreneurs with superior
understanding of information management processes are signi?cantly
Volume ? · Number ? · Summer ????
I,o Anokhin, Grichnik, and Hisrich
more likely to start more than one venture, which is not in line with this
hypothesis. This is further discussed below.
The ?ndings lend some support to hypothesis ,. Novice entrepreneurs
that have higher rankings on learning and personal growth, and satisfy-
ing work relationships are signi?cantly less likely to start a new venture.
Also, personal achievement, status and prestige, economic necessity, ?ex-
ibility in work/family, desire to test one’s own ideas, money and wealth,
and recognition do not di?erentiate between novice and serial entrepre-
neurs.
Signi?cant di?erences between Chinese and German entrepreneurs
were found on a number of dimensions. Overall, entrepreneurs in China
and Germany demonstrate many signi?cant di?erences. These ?ndings
are consistent with hypothesis ¡. Serial entrepreneurs appear to show
more similarities across countries. This lends support to hypothesis ,.
We realize, of course, that for serial entrepreneurs only large di?erences
could be detected due to the sample size limitations, and do not claimthe
results to provide a ?nal answer. While in general German entrepreneurs
tend to demonstrate higher urge for ?exibility with West German entre-
preneurs scoring highest on this goal, serial entrepreneurs showed no
signi?cant di?erences with respect to this goal at all. Generally, Chinese
entrepreneurs are more likely to be driven by the desire to test their own
ideas compared to German entrepreneurs (again, the contrast is high-
est with West Germans). Serial entrepreneurs in both countries are no
di?erent on this dimension. Chinese entrepreneurs care more for recog-
nition associated with their entrepreneurial status and less for satisfying
work relationship compared to their German counterparts. For serial
entrepreneurs this di?erence vanishes. Goals of personal achievement,
economic necessity, learning and personal growth are equally important
for Chinese and German novice and serial entrepreneurs.
The same pattern also occurs in terms of the skills and competencies
of entrepreneurs in China and Germany. In general, Chinese entrepre-
neurs tend to have a lower level of ?nance skills, and higher scores on
marketing skills, idea generation, managing information systems, tech-
nology, negotiating, oral presentation, writing abilities, problemsolving,
motivating employees, and developing personal business relationships.
At the same time, the di?erences are signi?cantly less for serial entrepre-
neurs – only writing skills and developing personal business relationship
skills di?er signi?cantly between China and Germany (Chinese respon-
dents score higher on both dimensions). The rest of skills/competencies
Managing Global Transitions
The Journey from Novice to Serial Entrepreneurship I,,
demonstrate statistical indi?erence between serial entrepreneurs in the
two countries.
While entrepreneurs in China tend were less satis?ed with how they
do their job, serial entrepreneurs in both countries show no noticeable
di?erences with respect to this characteristic. All entrepreneurs in China
showed higher satisfaction with their income and future prospects of
their companies and lower satisfaction with their employees compared
to German entrepreneurs.
Entrepreneurs in China and Germany di?ered considerably with re-
spect to their resource endowment. German entrepreneurs surpassed
their Chinese counterparts in terms of the availability of technological
and computer equipment, business facilities and o?ces, business loca-
tion, experienced workforce, innovation capabilities, reputation, image,
expertise and knowledge of employees and other resources. This was also
the case for serial entrepreneurs. The Chinese seem to have a slight ad-
vantage with respect to cash/liquidity over West German entrepreneurs
which re?ects, in part, the lower costs of doing business in China. On
average, entrepreneurs in China have better access to debt ?nancing and
distribution channels. Interestingly, despite claiming to have a less expe-
rienced workforce, Chinese entrepreneurs were higher on their estimate
of having access to quali?ed employees.
While in general entrepreneurs in China paid less attention to the sat-
isfaction of customer needs, being more concerned with product/service
development and cost reduction than their German counterparts, strate-
gies adopted by serial entrepreneurs in China and Germany demonstrate
remarkable similarity. Quality control, satisfaction of customer needs,
product/service development and quality assurance, customer service
and cost reduction were equally important for serial entrepreneurs in
both countries. Chinese serial entrepreneurs based their strategies more
on innovations in marketing and technologies, introduction of new
products and services, and increasing e?ciency and productivity than
did their German colleagues. They also relied more on partnerships and
alliances.
Serial entrepreneurs in both countries were also signi?cantly closer in
their estimates of their industries than average entrepreneurs. While gen-
erally entrepreneurs in Germany and China sawtheir industries in a very
di?erent light (Chinese respondents tended to conceive of their indus-
tries as being more competitive, dynamic and regulated), serial entrepre-
neurs in the two countries provided statistically similar estimates of their
Volume ? · Number ? · Summer ????
I,8 Anokhin, Grichnik, and Hisrich
industries with respect to industry growth, regulation, speed of techno-
logical change, supplier/retailer pricing, and customer demand.
On average, entrepreneurs in China employed more family members
than their German counterparts. Yet, for serial entrepreneurs the di?er-
ences were not statistically signi?cant. While males start more businesses
in China than in Germany, for serial entrepreneurs there is no di?erence
with respect to gender. Overall, entrepreneurs’ ventures in China demon-
strate higher growth rates as compared to Germany.
Neither the presence nor absence of these di?erences between the
entrepreneurs in China and Germany indicates whether or not these
characteristics are related to the likelihood of a novice entrepreneur be-
coming a serial one. The interaction e?ect of characteristics deemed im-
portant in explaining the probability of becoming a serial entrepreneur
was tested with the respondent’s country of origin (binary variable
‘China’). Since the number of variables in our ?nal model is large (close
to thirty), a separate testing of the interaction e?ect for motivations-
general competencies- and functional skills-based predictors. The results
are summarized in the last column of table :.?
As is indicated in table :, satisfying work relationships and learning
and personal growth are less important predictors of becoming a serial
entrepreneur in China compared to Germany. At the same time, sta-
tus and prestige associated with entrepreneurial occupation, and greater
?exibility in work/family balance mean more to the Chinese respondents
who have decided to start more than one venture. Superior oral presenta-
tion competencies as well as organizing and planning skills appear to be
more important predictors of self-selection into serial entrepreneurs in
China compared to Germany while managing information systems skills
seem to be more important in Germany than in China.
Conclusions
This study contributes to the entrepreneurship literature in several ways.
First, the results have discovered and explained a number of new ?nd-
ings with respect to serial entrepreneurship in general. Second, by com-
paring ‘average’ and serial entrepreneurs in emerging economies to their
counterparts in the developed ones, the results further the current un-
derstanding of the cross-culture di?erences a?ecting entrepreneurship.
In addition, the ?ndings indicate a possible relationship between the
entrepreneur’s experience and the probability of starting more than
one venture. Novice entrepreneurs with more salient learning/personal
Managing Global Transitions
The Journey from Novice to Serial Entrepreneurship I,,
growth motivations are less likely to start multiple companies. This may
indicate that novice entrepreneurs prefer to learn by their mistakes at the
?rst venture in order not to replicate them later. It is also apparent that
those who value satisfying work relationships tend to stay at the same
place longer, thus making emotional investment in social capital. This
suggests that serial entrepreneurs do not very much value their social re-
lationships within their current ventures, and easily move on to another
project once they see the opportunity. Also, entrepreneurs that rank
themselves relatively high on management development, training and
communication skills are less likely to launch more than one venture.
This may indicate that those who are more able in this regard are more
likely to achieve success at their ?rst venture and thus have no need to
initiate other projects. Alternatively, it may mean that such entrepreneurs
emotionally invest more in their companies and are more committed to
themthan those who become serial entrepreneurs. Since launching a new
venture puts a heavy burden on the entrepreneur in terms of informa-
tion processing, it is no surprise that individuals who ranked themselves
higher on data collection and information management skills are more
likely to become serial entrepreneurs.
The results also point out that entrepreneurs with superior compe-
tences in developing personal business relationships are less likely to
launch more than one venture. These entrepreneurs may be more likely
to become overly successful with their ?rst venture to the extent that they
do not want to engage in another one, or are so emotionally invested in
these relationships that abandoning them for an uncertain new project
is too high an opportunity cost. If the latter is true, it may be an indi-
cation of bonding rather than enabling social ties. Novice entrepreneurs
with superior analytical/problem solving skills are also less likely to be-
come serial entrepreneurs. This ?nding is consistent with the results on
entrepreneur’s overcon?dence. To go ahead, the entrepreneur must be
con?dent in his/her strategy; and superior analytical skills may actually
impede future business foundings as the entrepreneur would spend most
of the time trying to foresee and address possible contingencies. To suc-
ceed, entrepreneurs need to e?ectively communicate their ideas to others
both orally (‘elevator pitch’) and in writing (formal business plans). Our
data con?rms that novice entrepreneurs with superior oral presentation
competence and writing ability are more likely to become serial entre-
preneurs.
Finally, overall, there are a signi?cant number of di?erences between
Volume ? · Number ? · Summer ????
I¡o Anokhin, Grichnik, and Hisrich
entrepreneurs in China and Germany. In general, entrepreneurs in the
two countries show numerous dissimilarities in their goals, skills and
competences, job satisfaction, venture strategies and resources as well
as operate in quite di?erent industries. For serial entrepreneurs these
di?erences are signi?cantly reduced. Although some di?erences could
have resurfaced had we had a larger sample at our disposal, it appears
that serial entrepreneurs are more similar across countries. This simi-
larity notwithstanding, mechanisms determining further self-selection
of novice entrepreneurs into serial entrepreneurs di?er signi?cantly be-
tween China and Germany. Whether or not these ?ndings generalize to
the larger population of entrepreneurs in emerging countries needs fur-
ther studies.
Notes
I Without loss of generality.
: This cost function is increasing in the level of both skills and is convex.
, Entrepreneurs could have di?erent patterns of investment in human
capital, depending on the parameter of the optimization problem. In
any case, the goal of the investment strategy is to reach similar levels
of aptitude in both skills.
¡ Given a large number of variables in the model ,) we use the some-
what less stringent signi?cance level of o.Io as an indication of (pos-
sible) relationships between a certain variable and a probability of a
novice entrepreneur becoming a serial entrepreneur.
, Extended results are available from the authors upon request.
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Managing Global Transitions

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