Entrepreneurial Teams Research: Where are we Going?

In recent years there has been an increasing body of evidence suggesting that firms founded by entrepreneurial teams are more likely to achieve fast growth than firms founded by lone actors. Cyrine Ben-Hafaïedh explores the issue.

The populist view concerning the creation of a new venture is that it is established by a lone actor who bravely battles against a variety of challenges in an attempt to build a successful enterprise. However, over the past 15 years, there has been increased interest in the entrepreneurship literature about the notion of entrepreneurial teams starting new ventures as an increasing body of evidence suggests that fast-growth firms are more likely to be created by an entrepreneurial team rather than a lone actor. There has also been an escalated rate of firms being founded by multiple actors (especially in industries such as ICT) and this has also led to a desire by academics to learn more about the workings of entrepreneurial teams. But while more has been written about the subject, what are the movements that are occurring in developing an understanding of entrepreneurial teams?

In seeking to capture the signals of the current evolutions of entrepreneurial teams research, I recently identified three main trends. First, formation is key. By recognizing the specificities of entrepreneurial teams with regard to other organisational teams (e.g., the unique nature of the new venture context, the fact that entrepreneurial teams are naturally occurring rather than constructed or imposed by others), researchers are starting to begin to understand the critical nature and uniqueness to entrepreneurial teams of the formation stage and the need to explore it. The literature distinguishes two main routes to team formation, one strategic and one interpersonal. This dichotomy is also present in the practitioners’ discourses and we are still lacking processual evidence of how entrepreneurial teams really form, under which contingencies, and for what performance outcomes. Furthermore, how do business opportunities (identification, refinement, etc.) and entrepreneurial team formation process interact? And how does this relationship relate to performance issues? The initial structuring of the entrepreneurial team that is part of the ‘forming’ stage is beginning to be addressed in the literature through the issues of role formalization, specialization, and flexibility. The leadership role is singled out and more specifically investigated. Rewards are another team dilemma that is being progressively tackled.

The second key lesson being highlighted in entrepreneurial teams’ research is that resources need to be leveraged. Entrepreneurial team composition and its relationship with performance have been investigated quite frequently. The main research question that has been explored has related to the benefits of diversity, with the results being mostly inconclusive. Nevertheless, an overall impact of entrepreneurial team composition on new venture performance is found and team composition is important to investors (professional or not). Thus, without dismissing entrepreneurial team composition as a key factor for team and new venture performance, researchers are more attentive to the conceptualization and measurement of diversity (e.g., deeper-level diversity, and not just averaging individual characteristics). In alignment with the IMOI model (inputs-mediators-outputs-inputs), mediators are more and more considered and process variables are distinguished from emergent states such as entrepreneurial team cognition.

Finally, the importance of context has become more and more acknowledged in research relating to entrepreneurial teams. The context can first be seen from the perspective developed in a recent research agenda on contextualizing entrepreneurship research, that is business (industry, market), social (networks, household and family), spatial (geographical environments, industry districts and clusters) and institutional (culture and society, political and economic system). The temporal dimension is also an important context element, with the different development stages of an entrepreneurial team and temporal topics such as learning and turnover. This temporal dimension also restates the importance of longitudinal studies in order to observe a team’s evolution over time. Furthermore, context can also be embedded so as to typify the entrepreneurial team. This is notably the case for family entrepreneurship, social entrepreneurship, academic entrepreneurship, women entrepreneurship, business groups, franchises, and so on.

In summary, while there is more and more research on entrepreneurial teams, the overall level of publications and understanding is still quite low. However, recent trends show that there is increasing acknowledgment of the specificities of entrepreneurial teams (by focusing more on the formation stage notably), and that researchers are trying to go beyond simple demographics in studying team composition. Additionally, researchers are now examining the outcomes’ mediators more finely and appreciating that the context is more than a simple control variable. These trends are highlighted in a recent research handbook where contributors expand on the existing literature on entrepreneurial teams by examining essential issues such as formation, structuring, deep-level diversity and emergent states and investigate under-researched topics such as entrepreneurial teams within indigenous communities, ethnically diverse groups and women entrepreneurs. My new book Research Handbook on Entrepreneurial Teams: Theory and Practice, co-authored with Thomas Cooney, offers researchers a platform from which they can explore new insights into the phenomenon of entrepreneurial teams.

As with other entrepreneurship topics, researchers on entrepreneurial teams come from various disciplines and sometimes with preconceived templates. This can be seen through the influence that research on top management teams (strategic management) and on organisational groups in general (organisational behaviour) has had on entrepreneurial teams. Research on entrepreneurial teams is transitioning from infancy to adolescence (on certain topics in particular) and its distinctive features are being more and more acknowledged and valued. Borrowing or getting inspiration from research on other organisational teams must not be put aside, but researchers must ensure that the specificities of entrepreneurial teams are appropriately investigated. Concepts from other organisational teams are not always relevant for entrepreneurial teams or if used, they must be transposed with much care. Entrepreneurial team researchers should also be more diligent about how their research could contribute to other fields (such as strategic management literature, organisational behaviour literature, human resource management literature). Finally, the contribution from research on entrepreneurial teams should be of value to corporate entrepreneurial teams or intrapreneurial teams and, more generally, teams in a context of collective entrepreneurship.

Cyrine Ben-Hafaïedh is Professor of Entrepreneurship and Strategy at the IÉSEG School of Management (LEM-CNRS), France and Thomas M. Cooney is Professor in Entrepreneurship at the Dublin Institute of Technology, Ireland.

Research Handbook on Entrepreneurial Teams: Theory and Practice edited by Cyrine Ben-Hafaïedh and Thomas M. Cooney is out now.

Read the introductory chapter free on Elgaronline