Download We define collective entrepreneurship as conducting business

Collective entrepreneurs: what they are?
Mulukova Linara, MA student, HSE Faculty of Sociology, e-mail: [email protected]
We define collective entrepreneurship as persons conducting business together with at
least one partner, sharing ownership with them. Collective entrepreneurship can be, in our opinion, one of the means of risk diversification and fundraising.
According to the GEM Russia 2007 APS data 45,8% of current and nascent entrepreneurs (43,4% in 2006) can be classified as collective. Usually about 3 partners conduct a joint
venture.
In the present context it is rather important to understand what distinguishes collective
entrepreneurs from individual if there are any differences between them.
Judging from the GEM Russia 2007 APS data, the following specifics could be mentioned:
1. The portion of collective entrepreneurs is significantly higher among new and established
business owners (32-33% in 2007) comparing to potential entrepreneurs (15%). At the same
time, latent entrepreneurs tend to be collective much more frequently than any other (74%).
We can assume that potential entrepreneurs either incline to have individualistic strategy or
don't make any concrete plans and don't have any notion of whether to have partners or not.
Nascent entrepreneurs, in their turn, try to get partners in order to anticipate market constraints since they are only starting their new ventures.
2. On average, collective entrepreneurs are younger than individual. The mean age of the former group is about 31 year whilst the mean age of the latter is 25 years.
3. Collective entrepreneurs are less confident in their abilities to run business – their
knowledge, skills and experience. Consequently, one of the reasons for them to get partners
is necessity to raise the human capital involved in conducting business.
4. Collective entrepreneurs more frequently than individual entrepreneurs assess situation in
their region as favourable for business start-up.
5. Collective entrepreneurship can be characterized as opportunity-based more often than individual one. Collective entrepreneurs start their businesses not because of necessity but because they seek after self-realization and improvement of their opportunities.
6. The structure of income differs significantly between collective and individual entrepreneurs.
The former have a greater portion of income coming from their business ventures. This can
be a result of both a higher rate of not potential entrepreneurs but business owners among
them and, consequently, their greater experience and enterprises' life longevity.
7. The structure of collective entrepreneurs' social capital is considerably different from that of
individuals. The former are acquainted with other businessmen twice oftener than the latter
(42% and 21% respectively). This result is quite evident since the notion of collective entrepreneurship presupposes having broad business ties.