Start-up Motivations and Growth Intentions of Minority Nascent Entrepreneurs

Abstract

Firm growth is widely considered to be a measure of success for entrepreneurial businesses. Data indicate that there are systematic differences between minority and nonminority-owned firms with respect to growth. Black entrepreneurs are 50 percent more likely to engage in start-up activities than white entrepreneurs, however, black-owned firms are smaller and less profitable than their white-owned counterparts. Following the effort–performance–outcome–logic of expectancy theory and using data from the Panel Study of Entrepreneurial Dynamics (PSED), our paper investigates the differences between black and white entrepreneurs' motivations to start and intentions to grow a new venture. Findings indicate that there are significant differences in motivations between black and white entrepreneurs both in starting and in their intentions to grow the new venture. Implications for future research are discussed.

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