Abstract
In this article, we develop a gendered analysis of the expectations of venture growth by nascent entrepreneurs. Male entrepreneurs are notably overrepresented in the small cohort of firms that attain growth; to explore this phenomenon, we draw upon expectation theory during the nascency period to analyse the antecedents of growth outcomes. To refine this analysis, we factor in risk propensity, measuring the impact of the 2008 financial crisis on fundraising plans. Using UK data gathered between 2002 and 2020 from 5490 nascent entrepreneurs to test our hypotheses, we found that those with the greatest levels of start-up capital and high levels of risk tolerance had the highest expectations of growth and were likely to be male. This small cohort of growth-oriented entrepreneurs was termed ‘deviant men’ given their outlier status. Women became more cautious after the crisis, so even those with similar access to start-up capital as the deviant men had lower expectations of growth. We conclude by noting that at the nascency stage, expectations of growth are a critical influence upon future outcomes; a small cohort of deviant men has the highest expectations of growth, with women disadvantaged by gendered risk adversity.
Plain English Summary
Male entrepreneurs are more likely to pursue and achieve business growth. We explore some of the early influences upon this difference, focusing on future expectations of growth using a large sample of UK nascent entrepreneurs—those in the planning stage of setting up their own businesses. Those with access to high levels of start-up capital had the strongest expectations of growth; this small group was notably dominated by those we term ‘deviant men’, as they were outliers in the sample. We also explored the impact of risk on growth expectations by analysing how fundraising plans were affected by the 2008 financial crisis. Unlike the deviant men, women, even those with access to high levels of capital, became more cautious after this event. Thus, access to capital fuels expectations of growth, as does risk tolerance; women are disadvantaged by socialised risk avoidance. In addition to searching for ways of providing additional capital to women, policymakers could try to understand how women entrepreneurs define risk and minimise the effect on their fledgling business ambitions.
This is a preview of subscription content, log in via an institution to check access.
Similar content being viewed by others
Notes
Despite the core of the argument being about ‘deviant men’, we take a conservative approach when truncating the dependent and explanatory variables to avoid a few observations driving our findings. When this correction is not made, the results still hold.
While the UK officially moved out of recession in 2010, we opted to take a conservative approach by extending the period until 2011, to allow a likely lag in entrepreneurs recognising signals of improvement in the economy.
During the data collection period, GEM dedicated a few questions each year to a special topic in addition to the standard survey questions used every year in all participating countries. The start-up funding cost question asked every year in GEM UK was only asked in every country when finance was the special topic.
References
Aguinis, H., & O’Boyle, E., Jr. (2014). Star performers in twenty-first century organizations. Personnel Psychology, 67(2), 313–350. https://doi.org/10.1111/peps.12054
Ahl, H. (2006). Why research on women entrepreneurs needs new directions. Entrepreneurship: Theory & Practice, 30(5), 595–621. https://doi.org/10.1111/j.1540-6520.2006.00138.x
Ahl, H., & Marlow, S. (2012). Exploring the dynamics of gender, feminism and entrepreneurship: Advancing debate to escape a dead end? Organization, 19(5), 543–562. https://doi.org/10.1177/1350508412448695
Aldrich, H. E., & Ruef, M. (2018). Unicorns, gazelles, and other distractions on the way to understanding real entrepreneurship in the United States. Academy of Management Perspectives, 32(4), 458–472. https://doi.org/10.5465/amp.2017.0123
Alistair, R. A., & Ullah, F. (2014). The condition of smallness: How what it means to be small deters firms from getting bigger. Management Decision, 52(2), 326–349. https://doi.org/10.1108/MD-10-2012-0734
Alsos, G. A., & Ljunggren, E. (2017). The role of gender in entrepreneur–investor relationships: A signaling theory approach. Entrepreneurship Theory and Practice, 41(4), 567–590. https://doi.org/10.1111/etp.12226
Anyadike-Danes, M., Hart, M., & Du, J. (2015). Firm dynamics and job creation in the United Kingdom: 1998–2013. International Small Business Journal, 33(1), 12–27. https://doi.org/10.1177/0266242614552334
Autio, E. (2007). GEM 2007 Report on high-growth entrepreneurship. GERA.
Autio, E., & Acs, Z. (2010). Intellectual property protection and the formation of entrepreneurial growth aspirations. Strategic Entrepreneurship Journal, 4(3), 234–251. https://doi.org/10.1002/sej.93
Bradley, S. W., Wiklund, J., & Shepherd, D. A. (2011). Swinging a double-edged sword: The effect of slack on entrepreneurial management and growth. Journal of Business Venturing, 26(5), 537–554. https://doi.org/10.1016/j.jbusvent.2010.03.002
Bryan, M. L., & Jenkins, S. P. (2015). Multilevel modelling of country effects: A cautionary tale. European Sociological Review, 32(1), 3–22. https://doi.org/10.1093/esr/jcv059
Budig, M. J. (2006). Gender, self-employment, and earnings: The interlocking structures of family and professional status. Gender & Society, 20(6), 725–753. https://doi.org/10.1177/0891243206293232
Cameron, A. C., & Trivedi, P. K. (2013). Regression analysis of count data (Vol. 53). Cambridge University Press. https://doi.org/10.1017/CBO9781139013567
Carter, S., Mwaura, S., Ram, M., Trehan, K., & Jones, T. (2015). Barriers to ethnic minority and women’s enterprise: Existing evidence, policy tensions and unsettled questions. International Small Business Journal, 33(1), 49–69. https://doi.org/10.1177/0266242614556823
Cassar, G. (2006). Entrepreneur opportunity costs and intended venture growth. Journal of Business Venturing, 21(5), 610–632. https://doi.org/10.1016/j.jbusvent.2005.02.011
Cassar, G. (2007). Money, money, money? A longitudinal investigation of entrepreneur career reasons, growth preferences and achieved growth. Entrepreneurship & Regional Development, 19(1), 89–107. https://doi.org/10.1080/08985620601002246
Castrogiovanni, G. J. (1991). Environmental munificence: A theoretical assessment. Academy of Management Review, 16(3), 542–565. https://doi.org/10.5465/AMR.1991.4279475
Coad, A., Frankish, J., Roberts, R. G., & Storey, D. J. (2013). Growth paths and survival chances: An application of gambler’s ruin theory. Journal of Business Venturing, 28(5), 615–632. https://doi.org/10.1016/j.jbusvent.2012.06.002
Cohen, A. K. (1965). The sociology of the deviant act: Anomie theory and beyond. American Sociological Review, 30(1), 5–14. https://doi.org/10.2307/2091770
Coleman, S., & Robb, A. M. (2016). The next wave: Financing women’s growth-oriented firms. Stanford University Press. https://doi.org/10.1515/9781503600980
Conroy, T., & Weiler, S. (2016). Does gender matter for job creation? Business ownership and employment growth. Small Business Economics, 47(2), 397–419. https://doi.org/10.1007/s11187-016-9735-8
Cowling, M., Marlow, S., & Liu, W. (2020). Gender and bank lending after the global financial crisis: Are women entrepreneurs safer bets? Small Business Economics, 55(4), 853–880. https://doi.org/10.1007/s11187-019-00168-3
Crawford, G. C., Aguinis, H., Lichtenstein, B., Davidsson, P., & McKelvey, B. (2015). Power law distributions in entrepreneurship: Implications for theory and research. Journal of Business Venturing, 30(5), 696–713. https://doi.org/10.1016/j.jbusvent.2015.01.001
Cullen, J. B., Johnson, J. L., & Parboteeah, K. P. (2014). National rates of opportunity entrepreneurship activity: Insights from institutional anomie theory. Entrepreneurship Theory and Practice, 38(4), 775–806. https://doi.org/10.1111/etap.12018
Darnihamedani, P., & Terjesen, S. (2020). Male and female entrepreneurs’ employment growth ambitions: The contingent role of regulatory efficiency. Small Business Economics. https://doi.org/10.1007/s11187-020-00405-0
Davidsson, P., & Honig, B. (2003). The role of social and human capital among nascent entrepreneurs. Journal of Business Venturing, 18(3), 301–331. https://doi.org/10.1016/S0883-9026(02)00097-6
Decker, S., Estrin, S., & Mickiewicz, T. (2020). The tangled historical roots of entrepreneurial growth aspirations. Strategic Entrepreneurship Journal, 14(4), 616–638. https://doi.org/10.1002/sej.1348
Delmar, F., & Wiklund, J. (2008). The effect of small business managers’ growth motivation on firm growth: A longitudinal study. Entrepreneurship: Theory & Practice, 32(3), 437–457.
Erhardt, E. C. (2019). Measuring the persistence of high firm growth: Choices and consequences. Small Business Economics, 56(1), 451–478. https://doi.org/10.1007/s11187-019-00229-7
Erikson, T. (2002). Entrepreneurial capital: The emerging venture’s most important asset and competitive advantage. Journal of Business Venturing, 17(3), 275–290. https://doi.org/10.1016/S0883-9026(00)00062-8
Eshima, Y., & Anderson, B. S. (2017). Firm growth, adaptive capability, and entrepreneurial orientation. Strategic Management Journal, 38(3), 770–779. https://doi.org/10.1002/smj.2532
Estrin, S., Korosteleva, J., & Mickiewicz, T. (2013). Which institutions encourage entrepreneurial growth aspirations? Journal of Business Venturing, 28(4), 564–580. https://doi.org/10.1016/j.jbusvent.2012.05.001
Estrin, S., Korosteleva, J., & Mickiewicz, T. (2022). Schumpeterian entry: Innovation, exporting, and growth aspirations of entrepreneurs. Entrepreneurship Theory and Practice, 146(2), 269–296. https://doi.org/10.1177/1042258720909771
Fine, C. (2017). Testosterone rex: Unmaking the myths of our gendered minds. Icon Books.
Fletschner, D., & Carter, M. R. (2008). Constructing and reconstructing gender: Reference group effects and women’s demand for entrepreneurial capital. The Journal of Socio-Economics, 37(2), 672–693. https://doi.org/10.1016/j.socec.2006.12.054
Gastwirth, J. L., Gel, Y. R., & Miao, W. (2009). The impact of Levene’s test of equality of variances on statistical theory and practice. Statistical Science, 24(3), 343–360. https://doi.org/10.1214/09-STS301
Gatewood, E. J., Shaver, K. G., Powers, J. B., & Gartner, W. B. (2002). Entrepreneurial expectancy, task effort, and performance. Entrepreneurship Theory and Practice, 27(2), 187–206. https://doi.org/10.1111/1540-8520.00006
Greene, W. (2011). Econometric analysis (7th ed.). Prentice Hall.
Gupta, V. K., Wieland, A. M., & Turban, D. B. (2019). Gender characterizations in entrepreneurship: A multi-level investigation of sex-role stereotypes about high-growth, commercial, and social entrepreneurs. Journal of Small Business Management, 57(1), 131–153. https://doi.org/10.1111/jsbm.12495
Hart, M., Prashar, N., & Ri, A. (2021). From the cabinet of curiosities: The misdirection of research and policy debates on small firm growth. International Small Business Journal, 39(1), 3–17. https://doi.org/10.1177/0266242620951718
Hartog, J., & Vijverberg, W. P. M. (2007). On compensation for risk aversion and skewness affection in wages. Labour Economics, 14(6), 938–956. https://doi.org/10.1016/j.labeco.2007.08.002
Hermans, J., Vanderstraeten, J., Van Witteloostuijn, A., Dejardin, M., Ramdani, D., & Stam, E. (2015). Ambitious entrepreneurship: A review of growth aspirations, intentions, and expectations Entrepreneurial growth: Individual, firm, and region (pp. 127–160): Emerald Group Publishing Limited. https://doi.org/10.1108/s1074-754020150000017011
Hernandez, M., Raveendhran, R., Weingarten, E., & Barnett, M. (2019). How algorithms can diversify the startup pool. MIT Sloan Management Review, 61(1), 71–78.
Hessels, J., Van Gelderen, M., & Thurik, R. (2008). Entrepreneurial aspirations, motivations, and their drivers. Small Business Economics, 31(3), 323–339. https://doi.org/10.1007/s11187-008-9134-x
Higgins, T. (2021). Power play: Tesla, Elon Musk, and the bet of the century. Doubleday.
Hoetker, G. (2007). The use of logit and probit models in strategic management research: Critical issues. Strategic Management Journal, 28(4), 331–343. https://doi.org/10.1002/smj.582
Hurst, E., & Lusardi, A. (2004). Liquidity constraints, household wealth, and entrepreneurship. The Journal of Political Economy, 112(2), 319–347. https://doi.org/10.1086/381478
Jayawarna, D., Marlow, S., & Swail, J. (2020). A gendered life course explanation of the exit decision in the context of household dynamics. Entrepreneurship Theory and Practice. https://doi.org/10.1177/1042258720940123
Jennings, J. E., & Brush, C. G. (2013). Research on women entrepreneurs: Challenges to (and from) the broader entrepreneurship literature? The Academy of Management Annals, 7(1), 663–715. https://doi.org/10.1080/19416520.2013.782190
Justo, R., DeTienne, D. R., & Sieger, P. (2015). Failure or voluntary exit? Reassessing the female underperformance hypothesis. Journal of Business Venturing, 30(6), 775–792. https://doi.org/10.1016/j.jbusvent.2015.04.004
Kanze, D., Huang, L., Conley, M. A., & Higgins, E. T. (2018). We ask men to win and women not to lose: Closing the gender gap in startup funding. Academy of Management Journal, 61(2), 586–614. https://doi.org/10.5465/amj.2016.1215
Kepler, E., & Shane, S. (2007). Are male and female entrepreneurs really that different? Office of Advocacy, US Small Business Administration.
Levie, J. (2007). Immigration, in-migration, ethnicity and entrepreneurship in the United Kingdom. Small Business Economics, 28(2/3), 143–169. https://doi.org/10.1007/s11187-006-9013-2
Levie, J., & Autio, E. (2011). Regulatory burden, rule of law, and entry of strategic entrepreneurs: An international panel study. Journal of Management Studies, 48(6), 1392–1419. https://doi.org/10.1111/j.1467-6486.2010.01006.x
Lumpkin, G. T., & Dess, G. G. (2001). Linking two dimensions of entrepreneurial orientation to firm performance: The moderating role of environment and industry life cycle. Journal of Business Venturing, 16(5), 429–451. https://doi.org/10.1016/S0883-9026(00)00048-3
Mainemelis, C. (2010). Stealing fire: Creative deviance in the evolution of new ideas. Academy of Management Review, 35(4), 558–578. https://doi.org/10.5465/amr.35.4.zok558
Makino, S., & Chan, C. M. (2017). Skew and heavy-tail effects on firm performance. Strategic Management Journal, 38(8), 1721–1740. https://doi.org/10.1002/smj.2632
Manolova, T. S., Brush, C. G., Edelman, L. F., & Shaver, K. G. (2012). One size does not fit all: Entrepreneurial expectancies and growth intentions of US women and men nascent entrepreneurs. Entrepreneurship & Regional Development, 24(1/2), 7–27. https://doi.org/10.1080/08985626.2012.637344
Manolova, T. S., Carter, N. M., Manev, I. M., & Gyoshev, B. S. (2007). The differential effect of men and women entrepreneurs’ human capital and networking on growth expectancies in Bulgaria. Entrepreneurship Theory and Practice, 31(3), 407–426. https://doi.org/10.1111/j.1540-6520.2007.00180.x
Marlow, S., Greene, F. J., & Coad, A. (2018). Advancing gendered analyses of entrepreneurship: A critical exploration of entrepreneurial activity among gay men and lesbian women. British Journal of Management, 29(1), 118–135. https://doi.org/10.1111/1467-8551.12221
Marlow, S., & McAdam, M. (2013). Gender and entrepreneurship. International Journal of Entrepreneurial Behaviour & Research, 19(1), 114–124. https://doi.org/10.1108/13552551311299288
Marlow, S., & Swail, J. (2014). Gender, risk and finance: Why can’t a woman be more like a man? Entrepreneurship & Regional Development, 26(1/2), 80–96. https://doi.org/10.1080/08985626.2013.860484
Martiarena, A. (2020). Re-examining the opportunity pull and necessity push debate: Contexts and abilities. Entrepreneurship & Regional Development, 32(7–8), 531–554. https://doi.org/10.1080/08985626.2019.1675776
Martiarena, A. (2022). How gender stereotypes shape venture growth expectations. Small Business Economics, 58, 1015–1034. https://doi.org/10.1007/s11187-020-00431-y
McKelvie, A., Brattström, A., & Wennberg, K. (2017). How young firms achieve growth: Reconciling the roles of growth motivation and innovative activities. Small Business Economics, 49(2), 273–293. https://doi.org/10.1007/s11187-017-9847-9
McNeill, D. (2016). Governing a city of unicorns: Technology capital and the urban politics of San Francisco. Urban Geography, 37(4), 494–513. https://doi.org/10.1080/02723638.2016.1139868
Prügl, E. (2012). “If Lehman brothers had been Lehman sisters…”: Gender and myth in the aftermath of the financial crisis. International Political Sociology, 6(1), 21–35. https://doi.org/10.1111/j.1749-5687.2011.00149.x
Renko, M., Kroeck, K., & Bullough, A. (2012). Expectancy theory and nascent entrepreneurship. Small Business Economics, 39(3), 667–684. https://doi.org/10.1007/s11187-011-9354-3
Reynolds, P., Bosma, N., Autio, E., Hunt, S., De Bono, N., Servais, I., . . . Chin, N. (2005). Global entrepreneurship monitor: Data collection design and implementation 1998–2003. Small Business Economics, 24(3), 205–231. https://doi.org/10.1007/s11187-005-1980-1
Ringe, W.-G., & Ruof, C. (2020). Regulating fintech in the EU: The case for a guided sandbox. European Journal of Risk Regulation, 11(3), 604–629. https://doi.org/10.1017/err.2020.8
Rose, A. (2019). The Alison Rose review of female entrepreneurship. HM Treasury. Retrieved November 29, 2022, from:www.gov.uk/government/publications/the-alison-rose-review-of-female-entrepreneurship
Shaw, G.B. (1929). The plays of Bernard Shaw. Man and Superman With the Revolutionist's Handbook and Maxims For Revolutionists. Constable.
Shaw, E., Marlow, S., Lam, W., & Carter, S. (2009). Gender and entrepreneurial capital: Implications for firm performance. International Journal of Gender and Entrepreneurship, 1(1), 25–41. https://doi.org/10.1108/17566260910942327
Simmons, S. A., Wiklund, J., Levie, J., Bradley, S. W., & Sunny, S. A. (2019). Gender gaps and reentry into entrepreneurial ecosystems after business failure. Small Business Economics, 53(2), 517–531. https://doi.org/10.1007/s11187-018-9998-3
Sitkin, S. B., & Pablo, A. L. (1992). Reconceptualizing the determinants of risk behavior. Academy of Management Review, 17(1), 9–38. https://doi.org/10.5465/AMR.1992.4279564
Stam, E. (2015). Entrepreneurial ecosystems and regional policy: A sympathetic critique. European Planning Studies, 23(9), 1759–1769. https://doi.org/10.1080/09654313.2015.1061484
Storey, D. J. (2011). Optimism and chance: The elephants in the entrepreneurship room. International Small Business Journal, 29(4), 303–321. https://doi.org/10.1177/0266242611403871
Swail, J., & Marlow, S. (2018). ‘Embrace the masculine; attenuate the feminine’ – Gender, identity work and entrepreneurial legitimation in the nascent context. Entrepreneurship & Regional Development, 30(1–2), 256–282. https://doi.org/10.1080/08985626.2017.1406539
Thébaud, S. (2015). Business as plan B. Administrative Science Quarterly, 60(4), 671–711. https://doi.org/10.1177/0001839215591627
Tushman, M. L., & Anderson, P. (1986). Technological discontinuities and organizational environments. Administrative Science Quarterly, 31(3), 439–465. https://doi.org/10.2307/2392832
Verheul, I., & Van Mil, L. (2011). What determines the growth ambition of Dutch early-stage entrepreneurs. International Journal of Entrepreneurial Venturing, 3(2), 183–207. https://doi.org/10.1504/IJEV.2011.039340
Vroom, V. H. (1964). Work and motivation. Wiley.
Westhead, P., & Solesvik, M. Z. (2016). Entrepreneurship education and entrepreneurial intention: Do female students benefit? International Small Business Journal, 34(8), 979–1003. https://doi.org/10.1177/0266242615612534
Wiklund, J., & Shepherd, D. (2003). Aspiring for, and achieving growth: The moderating role of resources and opportunities. Journal of Management Studies, 40(8), 1919–1941. https://doi.org/10.1046/j.1467-6486.2003.00406.x
Yacus, A. M., Esposito, S. E., & Yang, Y. (2019). The influence of funding approaches, growth expectations, and industry gender distribution on high-growth women entrepreneurs. Journal of Small Business Management, 57(1), 59–80. https://doi.org/10.1111/jsbm.12491
Yousafzai, S., Fayolle, A., Lindgreen, A., Henry, C., Saeed, S., & Sheikh, S. (2018). Women entrepreneurs and the myth of ‘underperformance’: A new look at women’s entrepreneurship research. Edward Elgar Publishing. https://doi.org/10.4337/9781786434500
Zelner, B. A. (2009). Using simulation to interpret results from logit, probit, and other nonlinear models. Strategic Management Journal, 30(12), 1335–1348. https://doi.org/10.1002/smj.783
Author information
Authors and Affiliations
Corresponding author
Additional information
Publisher's note
Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.
Appendix
Appendix
Rights and permissions
Springer Nature or its licensor (e.g. a society or other partner) holds exclusive rights to this article under a publishing agreement with the author(s) or other rightsholder(s); author self-archiving of the accepted manuscript version of this article is solely governed by the terms of such publishing agreement and applicable law.
About this article
Cite this article
Martiarena, A., Levie, J., Marlow, S. et al. A ‘deviant men’ theory of business expectations in nascent entrepreneurs. Small Bus Econ 61, 909–930 (2023). https://doi.org/10.1007/s11187-022-00716-4
Accepted:
Published:
Issue Date:
DOI: https://doi.org/10.1007/s11187-022-00716-4