Entrepreneurial talent and venture performance: A meta-analytic investigation of SMEs

As the broad link between small and medium-sized firm activity and key policy goals such as employment or economic growth has become generally accepted, the conversation has focused on a more nuanced understanding of the entrepreneurial engines of economic activity. A significant body of research looking at antecedents to venture performance has identified that entrepreneurial talent variables account for meaningful differences in venture performance and that significant heterogeneity exists across performance measures. These are important issues for institutions and policy makers seeking to achieve specific economic goals (e.g., survival or growth of ventures, employment or revenue). Using meta-analysis, we integrate this work to view connections between aspects of entrepreneurial talent and different performance outcomes. Our investigation includes 50,045 firms (K of 183 studies) and summarizes 1002 observations of small and medium-sized firms. Analysis of these data yields an unexpectedly weak connection between education and performance. Furthermore, growth, scale (number of employees) and sales outcomes are significantly related to planning skills, while profit and other financial and qualitative measures are strongly connected with the network surrounding the firm founders. Moreover, we observe that entrepreneurial talent is more relevant in developing economies.