Exploring the differences between franchisee entrepreneurs and nascent entrepreneurs

Abstract

This paper is singular in its use of the PSED dataset for deriving a better understanding of the nature of nascent entrepreneurs as compared to franchisee entrepreneurs. We used previous studies on the differences between the two groups and developed variables divided into three dimensions: (1) prior experience, (2) growth objectives, and (3) motivation and risk. Jonckheere-Terpstra (J-T) tests, ChiSquare tests, F-tests and logistic regression models detected differences in all three dimensions. The conclusion is that franchisee entrepreneurs in the United States of America are distinctive in their characteristics. As compared to nascent entrepreneurs, franchisee entrepreneurs have less experience, less confidence in their skills, less capital, more aspirations for larger organizations, less confidence in their abilities to make the business a success, and more belief that their first-year incomes will be stable.This study makes a singular contribution to the literature by being the first to analyze the differences between nascent entrepreneurs and franchisees using the Panel Study of Entrepreneurial Dynamics (PSED) national database of the United States of America. The PSED, developed through the Entrepreneurship Research Consortium, was one of the most comprehensive studies ever completed on nascent entrepreneurs.Entrepreneurs and franchisees are often considered different in relationship to risky startup ventures. The popular culture image of an entrepreneur denotes a person who is willing to take large risks on uncertain ventures on the chance that he Int Entrep Manag J (2007) 3:403-418

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