Entrepreneurial Processes of Business Cluster Formation and Growth by ‘Habitual’ Entrepreneurs

Abstract

Previous studies on habitual entrepreneurs have not researched in any depth the processes and strategies associated with the growth of business clusters by habitual entrepreneurs. To gain insights into these issues, case studies were conducted with habitual entrepreneurs who owned high-growth businesses in Scotland. The research involved the analysis of life histories and business genealogies. A diversity was found in the backgrounds of the entrepreneurs studied, in the types of ventures founded, and in strategies adopted to build up their cluster of companies. Entrepreneurial motives, strategies, and practices by habitual entrepreneurs in building their business ownership clusters not only can differ markedly from one entrepreneur or type of entrepreneur to another, but also by individual entrepreneurs over time. Despite this diversity, little evidence emerged that the growth of business ownership clusters was motivated by orthodox corporate management principles, though corporate management practices were employed in some cases to subsequently assimilate the new venture into a cluster. On balance, entrepreneurial opportunism was more prevalent than planned “survivalist” diversification. Further, the concept of “entrepreneurial” performance is introduced to distinguish performance through creating a cluster of ventures rather than through growing a single one.