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Abstract: The purpose of this study is to understand the development of entrepreneurs personal
characteristics over the business life cycle. Based on three cases, together with theoretical
perspectives, the authors have discussed and analyzed the process of entrepreneurs personal
characteristic over the years of business, in terms of motivation, risk-taking and entrepreneurial
styles. In addition, relating these characteristics to the underlying theory of diminishing
marginal utility. The study showed various similarities between the cases and the characteristics
of the entrepreneurs, such as motivation. Furthermore, the concept of motivation had a direct
link to successful business within the three cases. The results of this study indicate that the
motivation of the entrepreneur is correlated to the diminishing marginal utility theory of risk
taking. Meaning that depending on the extent of increase in success of the business, the appetite
of the entrepreneurs to take risks will eventually decrease.
Does personality affect how one acts as an entrepreneur? Leibenstein (1968) argues that most
economists believe that in order to explain entrepreneurial behavior, one cannot take the
entrepreneurs personal characteristics or motives into account. Instead, the economic conditions
and the laws of economic processes determine what entrepreneurs would be able and willing to
fulfill. However, not everyone shares this point of view of entrepreneurship.
Casson (1982) defines entrepreneurship from a more personal stand point. Casson states that
ones personal characteristics lay the foundation of a successful entrepreneur. He highlights that
it was the entrepreneurs ability to take risks, knowledge of how the market functions,
manufacturing know-how, marketing skills, business management skills, and the ability to co-
operate, that are the basis to becoming a successful entrepreneur.
Caird (1988) agrees on the importance of ones personal characteristic in the success of an
entrepreneur. He states that a good nose for business, the desire to take risks, the ability to
identify business opportunities, the ability to correct errors effectively, and the ability to grasp
profitable opportunities, are characteristics of a successful entrepreneur.
Casson and Caird both claim that ones personal characteristics can affect the entrepreneurs way
of conducting business. This study focuses on four personal characteristics: entrepreneurial
motivation, risk taking of entrepreneurs, entrepreneurial styles, and the regrets of the
entrepreneurs. This research aims to examine these personal characteristics and how they change
between the early and the late stage of entrepreneurs business. The research will be carried out
through a cross case analysis, based on three case studies from The role of the entrepreneur in
the international new venture - opening the black box by Dr. Navid Ghannad.
1.1 Purpose
The purpose of this study is to understand the effect of ones personal characteristics on
entrepreneurial behavior and the changes of these characteristics throughout the life cycle of the
business.
2 Methodology
This explorative study was conducted in three independent cases of small born global businesses.
The cross case analysis method facilitates a deeper understanding of the context (Yin, 2003).
Each of the companies studied were established by a single entrepreneur around 1980. The three
entrepreneurs all resided in the same Northern region in Sweden and all started on an
experimental basis on their personal premises. Each business was started in the manufacturing
industry and received financial aid from the Swedish Governmental Business Development
Agency to start. At the time of the collection of the data, the founding (first-time) entrepreneurs
were still full owners and acting CEO in their organizations in all three cases.
Both primary and secondary data were used as main data source in this research and were
collected between 2000 and 2007. The primary data consists of a total of 108 personal interviews
with 58 respondents. The selection of respondents was achieved through snowball sampling.
Potter (1996) describes the snowball technique as one that begins with a purposive sample in
which key informants that can provide important insights are selected. Snowball sampling can be
placed within a wider set of link-tracing methodologies that seek to take advantage of the social
networks of identified respondents and provide a researcher with an ever-expanding set of
potential contacts (Spreen, 1992). Besides the owner also managers, former employees, business
partners, friends, family members, suppliers, and customers were interviewed. The interviews
were informal and done in person, and the interview style consisted of open-ended questions.
The locations of the interviews depended on the respondents and were held in several countries.
Interviews were between one and four hours, and were recorded, transcribed, and sent to the
respondents for correction and verification.
Secondary data were collected through annual reports, internal reports, photographs, newspaper
articles, memos, and contracts. If available, other academic studies (undergraduate and/or
graduate) investigating the case companies were used as secondary data. This heterogeneous
approach enhances multiple facets and facilitates comprehension and analysis, and has a twofold
purpose: first, to enrich the empirical case with multiple descriptions, which improves its
trustworthiness and enhances content validity (Rouse and Daellenbach, 1999); and second, to
enhance reliability by triangulating the data and method (Creswell, 1994).
The analysis of qualitative data consists of data reduction, data display, and conclusion
drawing/verification, according to three concurrent flows of activity (Miles and Huberman,
1994). Data analysis is widely recognized as the most difficult and least structured area of case
study research (Eisenhardt, 1989). To overcome this weakness, two forms of analysis were used.
Results of this study were analyzed from a within-case perspective and a cross-case perspective.
In the within-case analysis, the evidence from each of the three cases was analyzed separately,
utilizing the frame of reference as a basis. Any similarities or dissimilarities compared to the
frame of reference and to the theoretical framework are the findings of the within-case analysis.
Once the within-case analysis is complete, a cross-case analysis is initiated to uncover cross-case
patterns. Consequently, the analysis focuses on issues and aspects that can only be understood by
comparing the cases. For validity reasons, the findings were written in case reports of which the
next section of this paper is an excerpt. Most of the respondents independently read through their
transcripts and corrected the report before the final draft of the case was written. The findings
were also verbally presented and discussed with colleagues of the researchers.
3 Theoretical Framework
Baron and Bush (1999) point out an entrepreneurs social skills and social adaptability play a
critical role in their success. More specifically, social adaptability was recognized as the most
vital instrument for an entrepreneur to succeed. Nevertheless, it is discussed that social
adaptability is more important in the early stage of the new venture and becomes less important
throughout the life cycle of the business. Mostly due to the fact that networking and social skills
are regarded as more essential in the beginning of a business in order to get on the right track
(Ibid). Therefore, individuals social skills will have an impact on their entrepreneurial style and
thus on their success.
3.2 Motivation
Motivation is a very common yet rather unclear concept; motivation can be applied in several
contexts. Motivation can be used on everything from human driving forces to positive and
negative effective means for companies and organizations, as well as to positive or negative
emotional and mental states. A broad concept as motivation entails many different definitions
and ways of interpreting. However, all researchers have similar views of the concept. A common
definition of motivation can be as followed:
Motivation is the factors of an individual, that raises, channels and preserves a certain behavior
towards a given goal.
When discussing motivation in organizations, it can be derived from the actual work and tasks
involved, from the companys conditions and the social processes in the organization (Hein
2012). Individuals tend to gain motivation whenever they feel rewarded, for instance, in terms of
earning money. The money is a symbol of reward and will most likely motivate individuals to
work even harder (Ibid). This can also be linked to another study, stating that entrepreneurs
effectuate knowledge when they believe it acquire some sort of benefits for the individual
(Murphy, Liao & Welsch, 2006).
Motivation is a factor that all entrepreneurs wish to achieve and apply as an objective in order to
reach their goals, and it is also seen as the key element of success in businesses. Understanding
entrepreneurs motivation can easily provide an insight of the pattern and entrepreneurial style
that is used, and how the chosen style impacts their success (Robichaud, McGraw & Alain,
2001).
3.3 Risk-taking
Generally, individuals are risk-averse and often take risks whenever eventual gains are more
predictable than losses (Kahneman & Tversky, 1982).
After a detailed study of entrepreneurs and non-entrepreneurs, (Markman, Baron & Balkin,
2005) identified that inventors are more persevering and self-efficacious than people working as
employees or non-entrepreneurs. In addition, these characteristics are related to more regretful
thinking. Even though entrepreneurs and non-entrepreneurs might report the same number of
regrets, entrepreneurs have a tendency to have stronger regrets and thus, they correlate to
regretful thinking (Ibid).
Several researchers have studied the topic of risks with various outcomes. Some indicate that
entrepreneurs have to take risks since it is greatly linked to achievements and viewed as the
primary link to success (Masters & Meier, 1988). Others discuss that an entrepreneur have to
carefully examine and analyze the circumstances in order to understand if the possible reward is
equal to the extent of risks taken. While some studies indicate that there is no direct relationship
between entrepreneurs and risks, nevertheless, it does not imply that entrepreneurs are not risk
takers (Krueger, 2002).
Based on the different definitions stated above, the authors conclude that risk-taking has an
indirect link to entrepreneurships, since new ventures implies risks, due to the uncertainty of the
outcome. Furthermore, this will be the definition used for this study.
5 Cross-Case Analysis
According to Murphy, Liao and Welsch (2006), entrepreneurs effectuate knowledge when they
believe it will procure some individually defined benefits. In the context of knowledge driven
businesses, the need or goal of an entrepreneur is often a key motivator for the entrepreneurial
activity - and allows the entrepreneur to drive value through translation of knowledge into
commerce. Similarly, as a corollary to the observations of the paper, we can state that when the
innovators no longer perceive the individually perceived benefits that first drove them to
innovate, they cease or reduce the effectuation of knowledge and do not perceive much value in
driving business. To add to this, studies in the past indicate that regret and positive attributes
such as efficacy and perseverance among entrepreneurs are correlated, (Markman, Baron &
Balkin, 2005). In other words, as a successful entrepreneur innovates and perseveres in his
business, the likelihood that there will be residual regret for missed opportunities in life increases
(Ibid).
Over a long enough term, as a consequence of the reduced need for effectuation of knowledge,
combined with high amounts of regret, many entrepreneurs may feel the need to reduce their
involvement with the business or even disengage from the business altogether. It has also been
identified that ultimately entrepreneurs do disengage and depart from their firms, and this is
influenced by financial, economic or psychological factors. Studies have also found that it is
fairly common for successful entrepreneurs to report problems of fatigue and family issues, and
this and other reasons such as health or family reasons may cause them to choose to disengage
from their businesses (Vecchio, 2003).
This ties in with the concept of Diminishing Marginal Utility, wherein we can state that once an
entrepreneur is successful to the extent that he has met his goals that he set out to achieve, the
entrepreneur will no longer see a greater value in producing more success by means of exposure
to risk. This is because the value of the risk (and consequently the results of taking the risk) does
not have the same value that it used to. In other words, the utility value of the risk is diminished
as the successfulness of the enterprise increases beyond a threshold value, which has been
determined by the entrepreneur. Here, the utility referred to, may not be measurable in absolute
terms but can be gauged by relative position on a value scale (Kirzner, 1963). This finding has
also been corroborated by other studies by researchers such as Tversky and Kahneman and
Matthew Rabi which found that successful entrepreneurs were less likely to take on higher risks,
given that the additional wealth obtained by taking the risk had a lower utility value to them than
it would to someone less successful (Rabi, 2003; Tversky & Kahneman, 1992).
Combining the observations made above, we can say that entrepreneurs effectuate knowledge
when they perceive that they will benefit individually from it, and that even though they may
succeed in their venture through innovation, perseverance and risk-taking, there is a high
propensity that they will have a residual regret. In addition to the successful entrepreneur
experiencing entrepreneurial regret, it can be argued that he/she no longer sees the same value in
taking high risks given the success of the enterprise, and assigns the results of risk-driven gains,
or on occasion, the enterprise itself, a much lower value than other factors in his/her life. In other
words, we see that the successful entrepreneur no longer sees the same utility in the running of
his/her enterprise and in taking risks that lead to greater entrepreneurial success and that the
residual regret may drive them to disengage from their businesses.
In all the three case studies, we can see that the entrepreneurs methods of managing their
companies over the years has changed, starting with a more involved, collaborative style
dependent on the founders social network and social skills which then evolves to the founder
then transitioning to a more individual driven style focusing on a key area and delegating other
aspects to others.
5.1.1 Polaris
In the case of Polaris, Staffan Preutz was solely responsible for the designs of his products but
depended on his networks, such as the Synsam chain and the contacts he made while traveling
abroad, to drive sales. That, along with the network of contacts that he build was one of the
biggest factors that aided or even decided Polaris expansion. For example, he used his
connections across Europe to procure soft screws that aided in making his products revolutionary
and much better. Similarly he grew his company to other markets, including the US, by
advertising in trade shows and adding new people to his network. When his sister married an
Englishman who he then invited over to his operations at Boden and eventually worked with him
to penetrate the UK market. Over the years this has aided Polaris greatly in growing its business
and presence worldwide.
We can see that one of the challenges that Polaris faces today is that Staffans social network is
slowly disappearing as his old colleagues either retire or pass away, leaving the reins of their
businesses to their children, making it hard to do business like he was used to. This is an
impediment to Polaris as the respect and awareness of the significance of Polaris and Staffans
work is not obvious to the newer generations.
Even though Staffan is trying to combat this by including his daughters in the business, some of
his colleagues doubt the efficacy of this move, as the capacity of Staffans daughters may not
equal the contributions that Staffan brought to the table as the principal innovator at Polaris. This
can be taken as a step towards delegation.
Similarly, Staffan has now invested in a farm at Boden, which he plans to repurpose into a study
center. According to Staffan he would like to develop new relationship with a more select group
of companies, preferably smaller, family-owned businesses and focus on building a market
presence by driving better relationships with stakeholders including customers and distributors.
Given that Staffan almost single-handedly drove channel management and partnerships in the
past, this can be interpreted as a change in Staffans entrepreneurship style from the early stages.
5.1.2 Index
While Bjrn started Index Braille, he was responsible for the whole of the product development.
Taking the help of his personal network, including his colleague Torvald Lindquist, his
childhood friend, Staffan Syk and his younger brother, Sren. He also grew his networks by
attending various trade shows and presenting his product to various distributors. This aided him
greatly in expanding business, for example, Staffan Syk went to France and found that it was a
great market for their products.
However, as the firm grew, the focus of the firm shifted and became uncoordinated. To combat
this, Bjrn had to change his style, which he achieved by buying out everyone elses shares and
taking sole control over Index Braille. This allowed him to retain his focus on the direction he
wanted Index to take - to make Index the leading company that developed, produced and
distributed products that aided written communication between blind people. This focus resulted
in a re-developed printer that was very standardized. Bjrn was also now able to approach each
market differently and approach multiple distributors in a country if needed. Similarly,
experience has also changed the way Bjrn handles his distributors, trusting them with additional
resources only after they prove that they can show sustained growth. Caution has also become a
staple of his international growth, causing him to evaluate markets carefully before entering
them, and focusing on identifying scope for revenues before entry. Bjrn has also decided to step
away from the development of his products and focus on the management of the firm. These
changes signify a shift in the way Bjrn now manages Index - from a more participative, social
style to a more authoritative, cautious and pragmatic style of entrepreneurship with delegated
roles and responsibilities.
5.1.3 Liko
Gunnar Liljedahl used to work as a problem solver developing tools to be used by individual
patients at the County Council Public Health Board. When he realized that the problems were
more common than he thought, he asked the County Council for permission to sell these designs
to manufacturers as most of the designs he was making for individual patients could, in fact, be
mass made. When he realized that he was giving away opportunities, he started Liko to be able
to capitalize on his skills.
During this time, he gained valuable insights through his interactions with the occupational
physiotherapists. His next assistance with Liko came from his wife, Barbro who initially helped
him manage the paperwork before taking over marketing and sales. Once Liko started getting a
good volume of orders from buyers and the market seemed limited, Gunnar then started
expanding his network by participation in trade fairs and brought in his elder brother, Sren to
help him expand. Similarly, the expansion into the US happened through his social contacts. His
friends, Hans and Ethel Sigvardsson who happened to come over for dinner, happened to be
settled in the US and helped Liko gain a foothold in the market. Again, post the closure of this
venture, Likos expansion into the US, Japan and many other markets only happened when they
participated in trade fairs and found their distributors while networking.
However, once Liko was well settled and had expanded into many locations, Gunnar had to
adapt his style of managing the organization. He had to relook at the way the company appointed
distributors in the market and codify his ideals and thoughts on the culture of the company in
order to standardize the way Liko should be and share his vision about growth. Consequently,
once the Canadian distributor was let go of and Liko tried re-entering the US market for the third
time, Gunnar adopted a more methodical approach and more business-like, unlike before.
Further on, as Liko has grown, Gunnar has restructured the firm to be centered at Alvik post his
brothers departure and has now stepped away from the company and hired a professional CEO
to manage the business while focus on developing new products. This again indicates to us how
Gunnar has modified his style of entrepreneurship as Liko has grown over the years from a more
social and network-driven style to a more delegated and methodical way of managing the firm.
5.2.1 Polaris
In the case of Staffan Preutz the benefit of starting Polaris was to be able to support his family
and being able to innovate and develop his own designs. Again, one of the primary driving forces
that drove him to expand internationally, apart from the need to make money, was his need to
travel the world and meet his friends, or as Staffan puts it, have fun.
However, over the years, as the firm succeeded we see that Staffan now feels that many
decisions he took were risky and foolish. While he feels he wouldnt change any of it even if he
could, he would not take the same decisions today as he feels that he has had his fun.
Similar to Staffan Preutz, time has sated Bjrns need to innovate. He now recognizes that the
technology has changed and that the younger generation is much better at this than he is, and is
happy to transition into a more strategic role, and aiding his firm in making the right decisions.
He also feels more secure financially, and does not feel the pressure of decision making
anymore. This change in motivation is evident when he notes that it is now time to focus on
profits and stop development.
5.2.3 Liko
In the case of Gunnar Liljedahl, designing patient lifts and medical aids allowed him to capitalize
on his skills which he felt were otherwise not being used to their full potential or not giving him
enough returns or recognition as opposed to the effort of innovating. He felt that by innovating
and developing products himself, he was making the best of the opportunity and his skills. This
was his core motivation - to capitalize on his skills and make money. This drove him to grow his
business and expand internationally.
However, as the business grew and matured over the years, Gunnar realized that he no longer
wanted to be as involved in Likos operations, and instead wanted to spend more time with his
family and focus on constructing and developing new tools, which he felt were his core skills
(what he does best). This change in motivation is evident in his new style of management,
which involves delegating his executive powers to a CEO and focusing only on product
development.
5.3 Risk-taking
In all three cases, towards the end of each case, the innovator has now been identified to be less
risk-aware than at the start of the business. To examine this diminished risk appetite, we need to
examine the motivation of the innovator.
5.3.1 Polaris
After he had moved out from his fathers business, Staffan Preutz was driven by a need to prove
himself and the need to travel the world. His vision, ability to innovate and personal network
helped him translate his dreams into an enterprise. To do this, he took many risky decisions,
which he feels today, he would not take. However, over the years, his increased success, the
reduced need to prove himself accompanied by a change in the demographic of his networks
have driven him to change the way Polaris does business. A more performance driven method of
evaluating distributors or buyers, for example, is an indicator that Staffans attitude towards risk
has changed. This also explains in part, his motivation - that he wanted to prove that a person
from the North of Sweden could also make it big - and the reduced need to demonstrate the
same, now that he feels that he has made his mark.
At the later stage of the case, Bjrn is seen to focus more on stability and profitability- for
example he states that he feels it is time he stopped his development and started earning some
profits. To illustrate this he compares the growth of the company to climbing Mount Everest.
Similarly, he has delegated development to others while focusing on taking strategic decisions,
acknowledging that the younger people today are much better at doing this that he is. Similarly,
he has emphasized on Index being focused on being the best in Braille printers and nothing else,
even going to the extent of turning down orders for customized or modified printers, and not
offering new product lines. This is to ensure that Index retains its position in the niche market
that it caters to. These demonstrate that Bjrn is now risk averse, and wants to make sure that by
being really good at what it does in a niche market it dominates, Index Braille is exposed to no
more risks than it has to endure.
5.3.3 Liko
Gunnar Liljedahl started Liko in order to capitalize on his skills - he was a capable innovator
who found that his designs were being underused by his employer, and by giving it away to other
companies, he was making far less money than they were. This drives him to start Liko and
introduce innovative products in both the domestic as well as international markets. In order to
do this, he undertook many risky propositions, such as taking a massive loan from NUTEK and
lodge his parents house and land, buying a large quantity of engines just to get a better price, the
16MSEK that he borrowed to purchase Likos current facilities, partnering with his Swedish
friends in the US just to enter the market or changing the Japanese distributor on the basis of his
rapport with the person who was managing the medical aids for the old distributor.
However, once Liko had grown significantly, Gunnar no longer felt the need to take the kind of
risky decisions he had taken previously. As explained by his CEO, Hardy, the nature of the risks
that Gunnar took has changed. As stated by Hardy, the possible losses due to the risks that
Gunnar takes today have all been factored into the statement of operations, thus ensuring that
there are no major consequences to losing. Similarly, Gunnar also states that he finds some of the
risks he took earlier in his life foolish, and that he is not sure if he would take the same risks
today. He feels that things are different today (at the later stage of this case), and that he and his
family have a good income from Liko and could retire anytime and have a decent life.
5.4 Regret
We can also see from the analysis of the three cases that while all three entrepreneurs have
succeeded to various degrees through innovation and perseverance despite taking high risks, they
display a certain regret for missed opportunities in their lives. This corroborates studies in the
past that show a correlation between regret and positive attributes such as efficacy and
perseverance among entrepreneurs (Markman, Baron & Balkin, 2005).
5.4.1 Polaris
Combined with the move to include his daughters and change the way Polaris networks with its
channels, this can be interpreted to be a move towards a more detached style of leadership in
which Staffan slowly hands over key roles to the next generation.
Bjrn has also understood that what he considered his strengths in the past years no longer
remain his strengths and instead has changed the way he participates in Index. As he himself
says, he has changed his mode of working from the social style driven by his networks to a
managerial style with delegated responsibility, involving himself only at the strategic level. This
is to adjust for the fact that the younger generation is much better at innovating than he is. Bjrn
also understands that today his experience is his biggest strength aiding hi m in making faster
decisions.
Given the observation that Bjrns focus remains on processes and standardization (causing him
to turn down occasional requests for customized or modified printers), accompanied by a
reduced focus on research and development and an increased focus on revenues and profits, it
can be understood that Bjrn is not as aggressive as he was earlier and that his leadership style
has undergone a significant change.
5.4.3 Liko
In the case of Gunnar Liljedahl, Gunnar has chosen to leave the management of the company to a
professional and instead focus on product development and innovation, which he has
traditionally driven. Similar to Index Braille, Gunnar also envisions a future where the
manufacturing is standardized and Liko only does Sales, Marketing and Innovation from its
central office. Gunnar also wants to have Liko listed on the stock exchange and allow him to
engage his employees by offering rewards or bonuses from the liquidity the listing would bring.
Similarly, recently, Gunnar has also started inviting suppliers, distributors and other business
partners to visit his head office at Alvik, in order to foster better business relations. This is
similar to what Staffan Preutz is doing for Polaris, and all put together, it is evident that Gunnars
style of leadership has undergone a change, moving to be more organized and delegating
authority to others.
6 Discussion
In all of the three cases of Polaris, Index Braille and Liko we are able to see the same underlying
pattern; initially, the founders are driven innovate in order to satisfy their primary motivation -
networking and fun for Staffan Preutz, helping his mother and innovating for Bjrn Lfstedt and
innovating to take advantage of business opportunities for Gunnar. In order to be successful, in
the early stages, each of these entrepreneurs has had to tap into his social network or grow his
networks using social or business mechanisms such as trade fairs, and subject themselves (and
their businesses) to sometimes significant risks in order to avail themselves of opportunities to
grow.
However, as the success of each firm increased, each of these entrepreneurs also took steps to
consolidate gains and drive consistency in business, steps such as changing the way partners and
distributors were chosen in all three cases, re-structuring the operations of their companies to
reduce uncertainties in production and changing the way in which they engage with their
distributors or partners to build better relationships. These moves can be seen as adopting a
strategy of risk-mitigation, which ties in with the statements made by all three entrepreneur
expressing a certain satisfaction in terms of the progress they have made over the years and also
expressing a certain sense of regret in terms of decisions made (in two of three cases; Bjrn
Lfstedt and Gunnar Liljedahl - Staffan Preutz states that he no longer needs to take risks but
expresses no regrets). This clearly points to a diminished risk appetite.
Additionally, each of the entrepreneurs has also taken steps that indicate a changed style of
management - moving away from the networking dependent style of managing business, each of
the entrepreneurs has in his way, started delegating responsibilities. Staffan has started including
his daughters in the business and one of them now sits on the Synsam product council as well,
allowing him to replace his diminishing network with hers. Bjrn has chosen step away from the
product development and focus on the management of his firm, while Gunnar has hired a CEO to
manage his firm while he focuses on the core product development. This can indicate to us the
disengagement of the entrepreneur, which can be explained by a change in motivation. In the
case of Staffan, he feels that he no longer feels the need to prove himself. Bjrn no longer feels
the need to innovate and wants to focus on managing his company, as he finds that enjoyable,
thanks to the financial security he now enjoys. On the other hand, Gunnar does not want to deal
with the management of his company any more and would like to focus on the product
development instead and spend more time with his family.
Thus, from a study of the three cases, we see that as each entrepreneur is successful, the utility
value that he derives from the things that first motivated him to innovate has reduced over time,
and combined with entrepreneurial regret and reduced propensity to take risks due to
entrepreneurial success, causes the entrepreneur to disengage from aspects of his business (or
from the business itself, as is in the case of Liko).
7 Conclusion
The study, researched similarities in entrepreneurs personalities correlated with the life cycle of
their company. Three case studies from The role of the entrepreneur in the international new
venture - opening the black box by Dr. Navid Ghannad were examined: Cases Polaris AB,
Index Braille, and Liko AB. A cross-case analysis was made, and based around the theory of
diminishing marginal utility and the concepts of motivation, risk taking, and entrepreneurial
styles.
The research showed that there were indeed similarities between the entrepreneurs behind each
case. The three entrepreneurs were each very motivated to start their own business, yet each for
different reasons. As the underlying theory explained in the analysis, the further in the life cycle
of the company, the less prone the entrepreneurs became to take risks; even up to a point where
two stepped aside to let others manage. Furthermore, all three entrepreneurs showed regrets as a
result of the risk taking in the earlier stages of the business.
The study shows a direct correlation between the success of the business and the motivation of
the entrepreneur. However, the motivation of the entrepreneur is inversely correlated to the
diminishing marginal utility of risk taking. This means that the more the success of the business
increases, the more the appetite of the entrepreneur to take risks decreases.
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