The first US Panel Study of Entrepreneurial Dynamics [PSED I] is the most comprehensive assessment of the firm creation process yet completed. Based on a representative sample of those actively involved in business creation, analysis begins with the consideration of 75 factors that may affect the decision of adults to get involved in the creation of a new business, followed by a detailed exploration of over 130 factors that may be associated with completing the start-up process with a new firm. The results indicate, first, that over ten million persons are involved in the firm start-up phase as nascent entrepreneurs. Second, the major factors associated with entry into the start-up process have little impact on completion of the process with an operating business. Third, activities pursued in the start-up process – not the characteristics of the entrepreneur, the start-up, or the location – have a major impacts on the transition from start-up to a successful new firm. There is little impact associated with being male; being White, Black or Hispanic; having more education; being wealthy; having experience with other start-ups; having an "entrepreneurial personality"; or being in a supportive environment. This project demonstrates the value of tracking a representative sample of nascent entrepreneurs with a longitudinal study. Implications for future research, entrepreneurs, and public policy are substantial.
New Firm Creation in the United States is the most comprehensive and detailed assessment of how new business come about. Based on the first US Panel Study of Entrepreneurial Dynamics (PSED I), this study looked at over 130 factors related to business start-ups and focused on nascent entrepreneurs. Some of its findings include: The large number and growth of nascent entrepreneurs; major factors involved in the start-up process and becoming a nascent entrepreneur are unrelated to completion of the start-up process of a successful new firm; the activities of the start-up process - not the characteristics - impact the transition from start-up to successful new firm. Anybody can do this! Any person with the knowledge, skills, ideas, drive and the ability to mobilize resources and organize a business can create a new firm. New Firm Creation in the United States shows the value of tracking a representative sample of entrepreneurs in a longitudinal study. The implications for public policy are huge in that efforts to increase new start-ups to improve economic growth may be different to those designed to assist disadvantaged groups develop a role in the economy though entrepreneurship.