Is a Bit More Experience Bad? The Role of Entrepreneurial Experience on Investment Rate

Bach Nguyen

Research output: Contribution to journalArticlepeer-review



This study investigates the influence of entrepreneurial experience on small business investment. The purpose of this paper is to examine whether entrepreneurs with more prior start-up experience are better able to identify business opportunities and successfully transform these opportunities into investment projects.

The empirical setting in this study is Vietnam. The authors employ a panel data of small businesses (mostly households) from 2005 to 2013, and use a fixed effect method to estimate the regression coefficients. The results are also re-checked using the general method of moments and matching technique.

Empirically, it is found that entrepreneurial experience is an important determinant of investment decisions. Specifically, entrepreneurs with one start-up experience make more investments than novice entrepreneurs. However, entrepreneurs with more than one start-up experience do not make more investments than entrepreneurs with one start-up experience.
Research limitations/implications

This is country-specific research. Further study may employ data from multi-countries to re-test the validity of the hypotheses.

This study provides a new perspective for analysing the role of entrepreneurial experience on entrepreneurial investments. It shows that prior start-up experience may turn out to be a liability to entrepreneurs since it restricts their ability to identify new opportunities.
Original languageEnglish
Pages (from-to)1166-1187
Number of pages22
JournalInternational Journal of Entrepreneurial Behavior and Research
Issue number6
Early online date1 Jun 2019
Publication statusPublished - 2 Sept 2019

Bibliographical note

© Emerald Publishing Limited 2019
Published by Emerald Publishing Limited
Licensed re-use rights only


  • Entrepreneurial experience
  • Investment
  • Opportunity recognition
  • Small businesses
  • Vietnam


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