The heart of a new venture: the entrepreneurial team

Citation

Schjoedt, L. and Kraus, S. (2009), "The heart of a new venture: the entrepreneurial team", Management Research News, Vol. 32 No. 6. https://doi.org/10.1108/mrn.2009.02132faa.001

The heart of a new venture: the entrepreneurial team

Article Type: Introduction From: Management Research News, Volume 32, Issue 6.

The entrepreneurial team is at the heart of any new venture (Cooper and Daily, 1997); and it is fundamental to new venture success (Birley and Stockley, 2000). One reason for this is the fact that creating a new venture is a challenging and demanding task. Many ventures are started by an individual who turns to others for help with various aspects of the venture creation. Whereas others begin with a team, making venture creation a collective endeavor from the start (Kamm et al., 1990; Watson et al., 1995; Aldrich et al., 2002; Ruef et al., 2003). Despite its importance, little systematic research has been conducted on entrepreneurial teams (Cooper and Daily, 1997; Foo et al., 2006). Even though progress has been made and an emerging body of literature is developing (e.g. Watson et al., 1995; Birley and Stockley, 2000; Frances and Sandberg, 2000; Forbes et al., 2006; Harper, 2008), existing scholarly literature is still relatively limited. Considering the importance of the entrepreneurial team to the venture, its performance, and to the field of entrepreneurship, it is surprising that the entrepreneurial team as a research topic has been neglected (Foo et al., 2006; Ucbasaran et al., 2001). In an effort to draw attention to the topic of entrepreneurial teams and to stimulate academic research on entrepreneurial teams, this special issue of Management Research News is presented.

Topics and articles in this issue

The articles included in this special issue address important issues relevant to understanding the concept of entrepreneurial teams and how entrepreneurial teams impact new ventures. Collectively, the articles in this issue address definition and determinants of entrepreneurial team outcomes, e.g. environmental factors, team composition and team processes.

Defining the concept of an entrepreneurial team

One of the reasons why entrepreneurial teams have been widely neglected in the literature (Foo et al., 2006) may be found in the fact there is no generally accepted definition of what constitutes an entrepreneurial team. This concern is also evident in the present issue, where Schenkel and Garrison define an entrepreneurial team as “a group of two or more individuals whoare actively engaged in innovative efforts designed to launch or extend the value generated by a venture”. Whereas Mueller and Gemünden imply that an entrepreneurial team consists of a group of venture founders who interact in developing new ventures. Leary and DeVaughn imply that an entrepreneurial team is more than one person who own part of the new venture. Tihula, Huovinen and Fink define a management team as “a small group of managers [...] who give a firm its general direction”. Superimposing this on new venture creation, it seems that these authors imply that an entrepreneurial team is a small group of individuals directing the creation of a new venture. Cooney defines the entrepreneurial team as “two or more individuals who have a significant financial interest and participate in the development of the enterprise”. The lack of consistency in defining the entrepreneurial team, as well as the many omissions to explicitly address what defines the entrepreneurial team in the extant literature, led Schjoedt and Kraus to propose a more comprehensive and literature-driven definition of the entrepreneurial team. Consequently, the definitions of the entrepreneurial team, whether explicitly stated and implicit, in this issue are part of the definition proposed by Schjoedt and Kraus.

Environmental factors and the entrepreneurial teams

The papers in this special issue address the direct (Birley and Stockley, 2000) and indirect (Cohen and Bailey, 1997; Mueller and Gemünden, in this issue) effects the external environment has on the entrepreneurial team. This relationship is investigated either explicitly or implicitly. The papers by Mueller and Gemünden (European and German software companies), Tihula et al. (companies from East Finland), and Leary and DeVaughn (US banks) implicitly address the fact that the external environment, directly or indirectly, influence the entrepreneurial teams studied by specifying the sample. On the other hand, Cooney explicitly addresses the external environment in his study of software development companies in the USA and Ireland. The findings by Cooney are interesting when speculating why the US firms developed a combination of organic structure and deliberate strategy whereas the Irish firm developed a combination of mechanical structure and deliberate strategy when they originated with a combination of organic structure and emergent strategy. It is not surprising that the firms developed deliberate strategies as they evolved. The interesting aspect is the different structures. Placing Cooney's findings in the context of the seminal work by Chandler (1962), there is a confirmation that structure follows strategy and that similar external environmental conditions influence firms to follow similar strategies. As a result, the findings by Cooney illustrate why the external environment needs to be explicitly considered in research on entrepreneurial teams. Also, Schjoedt and Kraus explicitly address the issue of the external environment and its impact on the entrepreneurial team.

Entrepreneurial team composition

The importance of entrepreneurial team composition is illustrated by the findings presented by Tihula et al. These researchers found that entrepreneurial teams were formed, to a higher degree, when a new venture required a diverse knowledge base at start up. Similarly, Leary and DeVaughn examine how industry experience and prior entrepreneurial experience of the entrepreneurial team influence the successful venture launch. These two studies are in tune with past research on entrepreneurial team composition by addressing surface-level constructs. The article by Schenkel and Garrison address a beginning trend in entrepreneurship research by examining social capital. These scholars study social capital in an entrepreneurial team context. They empirically examine how dimensions of teams' collective social capital influence team efficacy and, in turn, venture performance. Thus, these researchers address a deeper-level construct than the surface-level constructs of knowledge and experience. Schjoedt and Kraus address entrepreneurial team composition based on a thorough review of the literature. They stress the importance of balancing heterogeneity and homogeneity in both surface – and deep-level individual differences within entrepreneurial teams. These scholars emphasize that deep-level individual differences (i.e. cognition, personality) and changes in the entrepreneurial team to achieve the appropriate balance between homogeneity and heterogeneity need more attention in entrepreneurial team research.

Entrepreneurial team processes

While Schenkel and Garrison implicitly study how entrepreneurial teams develop team self-efficacy from their collective social capital, and how the team self-efficacy influences venture performance, Mueller and Gemünden directly examine how team processes within the entrepreneurial team (communication and coordination) influence customer and competitor orientation and, in turn, impact venture performance. As with the findings presented by Mueller and Gemünden, Schjoedt and Kraus emphasize that communication is an important aspect of entrepreneurial team processes. In addition, these researchers point out that conflict, as well as power distribution, within the entrepreneurial team are issues that need to be carefully managed.

Concluding thoughts

Taken together, the six articles by 12 authors from five different countries contained in this special issue advance the entrepreneurial team literature. Collectively, the articles also illustrate some of the problems of past research on entrepreneurial teams: inconsistent definitions of entrepreneurial teams, if even addressed, and focus on surface-level constructs. This Special Issue with its six articles also advance the literature by considering constructs new(er) to entrepreneurial team research and by presenting opportunities for future research directly by emphasizing a need for additional research as done by Schjoedt and Kraus, or indirectly by not examining recent advances in the organizational behavior literature on team-level constructs in an entrepreneurial context, such as shared leadership (Ensley et al., 2006). With these considerations and the articles in this special issue, we, the guest editors, encourage additional research on entrepreneurial teams.

Leon SchjoedtIllinois State University, Normal, Illinois, USA

Sascha KrausUniversity of Liechtenstein, Vaduz, Liechtenstein