How to Avoid Profiles of Failure when Supporting Entrepreneurs in an Economic Crisis

Abstract

Purpose: We attempted to detect the configurations of success or failure that may help entrepreneurs' public orientation. Design/methodology/approach: We used data from the latest economic crisis in a region with high levels of unemployment. We studied 2,210 entrepreneurs from Andalusia (Spain). From each, we analysed 207 variables and applied the fuzzy version of qualitative comparative analysis (fsQCA). This methodology allowed us to infer causality between combinations of factors and positive/negative effects. Findings: We concluded that there are at least two profiles that should be avoided when starting a business; both refer to projects in quite attractive sectors: an environment with high concentration and survival rates, and when (i) not enough education or (ii) high assets turnover is expected. Research limitations/implications: It was difficult to obtain a complete database to replicate a study in another region. Moreover, the data corresponded to a period of economic crisis, and the results may not be valid for a more favourable period. Regarding the implications, there have been several unsuccessful attempts in the literature to find a linear association between factors and entrepreneurial success; it is necessary to consider the non-linear and asymmetric relationships between the variables. Practical implications: The most attractive sectors for entrepreneurs carry considerable risk for the success of the future business, since 'greed clouds judgment'. Support services should filter out candidates with insufficient training or excessive expectations. Originality/value: The techniques used in this study allow the consideration of explanatory variables that are not independent of each other, and the subjective aspects of some of the analysed characteristics are examined.