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The satisfaction of entrepreneurs in their business after three years of business ownership is estimated. Satisfaction may be perceived as a measure of performance and may be a determinant on the entrepreneur's decision to invest more, downsize or close. The discrepancy theory was used. Findings show that entrepreneurs focusing on non-economic goals gained more satisfaction than entrepreneurs with economic goals. Evidence was gathered that women achieved more satisfaction than men.

The hypothesis that entrepreneurs search for information in a rational manner is tested using a sample of 1,176 entrepreneurs. The results are decidedly mixed, revealing that information search activity is not necessarily constrained in a rational manner. For example, inexperienced entrepreneurs sought more information, not less as predicted by the hypothesis. Meanwhile, confident entrepreneurs sought less information, as posited by the hypothesis.

The performance of new business enterprises based on factors that can be observed at the time of the start-up is analyzed. Human and financial capital indicators are considered to determine their effect on the probability of three possible performance outcomes, namely: failure, marginal survival or high growth. The study made use of a longitudinal study of 1,053 new ventures representing all industry sectors and geographic areas. Results indicate that measures of general human capital influenced both survival and growth and that management know-how variables had more limited impact.

Predicting new firm performance is a difficult task since it is a relatively young field and there are many complications inherent in the process. These complications include research style which refer to the numeroustypes of research done and the method of analysis. Complications also include environmental factors or external events, internal change, varied goals of the entrepreneur, type of management and type of business.

Factors that influence financial investment decisions of entrepreneurs after the first year of operations are evaluated. An escalation bias is observed, in which entrepreneurs tend to reinvest more capital after a negative outcome. Reinvestment in this case is not necessarily good or bad but the presence of the bias indicates that entrepreneurs are influenced by psychological as well as objective and economic factors.

Conventional wisdom has it that companies with low market shares are doomed to marginal profits, at best, while market-share leaders show the best returns on investment. If the conventional wisdom is correct, though, most companies would be candidates for harvesting or liquidation. However, many companies with low market shares survive and even prosper. What characteristics enable the highly profitable low-share company to succeed? The authors contend that companies in industries with slow growth and few product changes and those that make frequently bought items are among businesses that prosper with low market share. Similarly, low-share businesses that pursue a specific focused competitive strategy, often emphasizing quality and cost, seem to do best. [ABSTRACT FROM AUTHOR]

While the development of technically advanced new products entails elements of risk which some small manufacturers may well decide to leave to others, many of these barriers can be overcome. This analysis, based on a survey of five small companies and supplemented by interviews with executives of 18 other organizations, provides (1) a basis for judging the extent to which major problems might be barriers to all small companies, and (2) considers ways in which these can be overcome or minimized. [ABSTRACT FROM AUTHOR]

The article presents the findings of a study on the differences in the way certain large and small companies undertake product development and the effect these differences have on development costs. Evidence collected suggests that large companies tend to spend substantially more to develop products than small firms. Three major factors make it possible for small companies to develop new products at less cost than large organizations: ability of engineers, attitude toward costs, and communication and coordination. This study shows the natural advantages of small companies, but efficiency in product development does not ensure competitive success.

Previous research is reviewed on certain aspects of the characteristics of entrepreneurs and on the incubator organizations from which they come. Findings from these focused studies are then contrasted with the result from a broadly-based survey of 890 entrepreneurs. It is clear that care must be used in generalizing from specific studies and that researchers must consider thoughtfully the nature of samples examined and the research methods used. (Reprinted by permission of the publisher.)