Are You Experienced or Are You Talented?: When Does Innate Talent vs. Experience Explain Entrepreneurial Performance?
Strategic Entrepreneurship Journal, Forthcoming
32 Pages Posted: 19 Jun 2006 Last revised: 15 Aug 2014
Date Written: Dec. 20, 2011
We explore whether entrepreneurial performance is due to innate talent or the accumulation of entrepreneurial experience. Using a novel dataset with multiple observations of founding attempts per individual, we generate a unique measure of entrepreneurial talent. In contrast to prior findings, the relative importance of experience vs. talent changes with the context. When the current market or technology is familiar, then experience dominates. However, when the venture context is unfamiliar, talent is more important. Individuals with experience and talent handle both familiar and unfamiliar aspects and may extract more from a given level of experience. The findings advance our understanding of how the drivers of venture performance shift with the broader technological and industry environment and places limits on when experience aids performance.
Keywords: organizational learning, top management teams, entrepreneurship, exploration, strategy
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