Entrepreneurial legacy: Toward a theory of how some family firms nurture transgenerational entrepreneurship

•Entrepreneurial legacy is the narrative of past entrepreneurial achievements or resilience.•Entrepreneurial legacy motivates and gives meaning to entrepreneurial behaviors.•Large and cohesive families imprint their entrepreneurial legacy on the next generation.•Entrepreneurial legacy motivates three activities that lead to next generation entrepreneurship.

Research shows that family firms are less entrepreneurial, on average, especially after the founder departs. There are notable exceptions, however, and so we build a new theory to explain how these exceptional firms accomplish transgenerational entrepreneurship. Specifically, we conducted in-depth interviews with owners and (potential) successors in 21 German wineries that are, on average, in their 11th generation. We introduce entrepreneurial legacy, which we define as the family's rhetorical reconstruction of past entrepreneurial achievements or resilience, and theorize that it motivates incumbent and next-generation owners to engage in strategic activities that foster transgenerational entrepreneurship. Entrepreneurial legacy thus helps explain transgenerational entrepreneurship and has implications for family-firm, imprinting, and succession research.