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In this paper, we explain and examine how engaging in part-time entrepreneurship (creating and managing side businesses while remaining employed for wages in existing organizations) uniquely positions individuals to exhibit innovative behavior in employee roles. To study this phenomenon, we integrate the literatures on entrepreneurial learning, knowledge and learning transfer, and employee innovation. We hypothesize that part-time entrepreneurship provides an opportunity for individuals to acquire knowledge and skills conducive to enacting innovative behaviors as employees. Multilevel regression analysis of a sample of 1,221 employee responses across 137 organizational units provides evidence to support our positive transferal hypothesis. Further, we find that individual differences in goal orientations and work-unit climates for innovation strengthen these relationships.

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