Entrepreneurship research asserts that entrepreneurial venture is the answer to growing business enterprises and accelerating economic growth of nations. Entrepreneurship has become increasingly critical for firms to achieve and maintain competitive advantages in the increasingly competitive environment due to the globalization of markets and continually changing technologies. The benefits of entrepreneurship may also result in national economic development in terms of increasing employment rates, innovations, and spillover effects (Zahra, Ireland, Gutierrez, & Hitt, 2000). However, despite the importance of entrepreneurship to competitive advantages of firms and the economic growth of nations, our knowledge about entrepreneurship is still very limited (Ripsas, 1998; Wennekers & Thurik, 1999). Entrepreneurship necessitates the presence of opportunities as well as enterprising individuals who take advantage of opportunities to create the new ventures (Venkataraman, 1997). Contemporary definitions of entrepreneurship or delineations of entrepreneurship research focus on emergence (Gartner, 1988; Shane & Venkataraman, 2000). The suggestion is that entrepreneurship research should deal with early stage phenomena, such as how opportunities are detected and acted upon, or how new ventures come into being. Shane and Venkataraman (2000) also suggested that entrepreneurship involves the study of the sources of opportunities, the processes of discovery, evaluation and exploitation of these opportunities. This perspective of entrepreneurship emphasizes that the core of entrepreneurship research is the investigation about how and why opportunities are discovered and exploited (Baron & Shane, 2005; Carolis, Litzky, & Eddleston, 2009). This study adopts insights from both the discovery and creation views of entrepreneurship in the present research. Following Shane and Venkataraman's (2000) suggestion, some scholars have paid attentions to understand the determinants of opportunity recognition (e.g., Arenius & Clercq, 2005; Bhagavatula, Elfring, van Tilburg, & van de Bunt, 2010; Carolis & Saparito, 2006; Hayton, 2005; Hsieh, Nickerson, & Zenger, 2007; Kontinen & Ojala, 2011; Lettl, Hienerth, & Gemuenden, 2008; Lumpkin & Lichtenstein, 2005; Ma, Huang, & Shenkar, 2011; Ozgen & Baron, 2007; Park, 2005; Tumasjan & Braun, 2012; Wang, Ellinger, & Wu, 2013) while others have done in exploring and identifying the determinants and entrepreneurial processes of venture creation (e.g., Carolis et al., 2009; Edelman & Yli-Renko, 2010; Grimaldi & Grandi, 2005; Hoang & Antoncic, 2003; Kickul, Gundry, Barbosa, & Whitcanack, 2009; Kostova & Roth, 2003; Neck, Meyer, Cohen, & Corbett, 2004; O'Gorman, 2003; Phillips, Tracey, & Karra, 2013). These prior studies have enriched our understanding about entrepreneurial behavior. However, little has been done in discussing how entrepreneurs mobilize their human and social capital to pursue entrepreneurship. For example, we know little of work and venture experiences that may enhance the ability to recognize or exploit opportunities. Does formal education increase an entrepreneur's cognitive abilities to better evaluate opportunities? Are memberships in social relations a potential source of scarce information leading to opportunity exploitation; are they facilitators of resource acquisition, or perhaps a location of knowledge diffusion leading to increased competition? How do various forms of human and social capital differentially contribute to the dynamic processes of opportunity recognition and exploitation? In this paper, we attempt to address this issue. The purpose of this study is to provide methodologically sound empirical longitudinal observations leading to a better understanding of aspects of human and social capital that may be influential during the emergent phases of the entrepreneurial process. Furthermore, this study indicates that neither human nor social capital in isolation can completely explain how entrepreneurs identify and exploit opportunities (Bhagavatula et al., 2010). Our objective is to discuss the roles of human capital and social capital in recognition of entrepreneurial opportunities and the effect of social capital on transforming such opportunities into successful new ventures. In this study, human capital is defined as expertise, experience, knowledge, reputation, and skills of the individuals (Coleman, 1988; Lester, Hillman, Zardkoohi, & Cannella, 2008) while social capital refers to the tendency of individuals to utilize their personal relationship network, such as friends, colleagues, and more general contacts, to receive support and gain access to resources to create the new ventures (Boxman, De Graaf, & Flap, 1991; Fukuyama, 1995; Nahapiet & Ghoshal, 1998). To illustrate our conceptual model, this research includes a comparative case study of Trend Micro (an anti-virus firm) and Taiwan Semiconductor Manufacturing Company Ltd. (TSMC), a foundry business. Both are Taiwan-based entrepreneurial firms and have grown successfully in their industries. Data sources include both primary (personal interviews) and secondary (database of archival materials), and data analysis is a mixture of narrative analysis (thick description) and comparison analysis (case study). THEORETICAL BACKGROUND Opportunity recognition Opportunity recognition is the ability to identify a good idea and transform it into a business concept that adds value or create new businesses (Lumpkin & Lichtenstein, 2005). Opportunity recognition is the bridge that connects a breakthrough idea to the initial innovation evaluation process, which in turn leads to the formation of formally established commercialization efforts (O'Connor & Rice, 2001). Recently, some scholars have paid attentions to understand the determinants of opportunity recognition such as individual characteristics (Bhagavatula et al., 2010; Busenitz, 1996; Hayton, 2005; Hsieh et al., 2007; Kaish & Gilad, 1991; McCline, Bhat, & Baj, 2000; Tumasjan & Braun, 2012; Wang et al., 2013), social network and capital (Arenius & Clercq, 2005; Bhagavatula et al., 2010; Carolis & Saparito, 2006; Kontinen & Ojala, 2011; Ma et al., 2011; Ozgen & Baron, 2007), firm characteristics (Lumpkin & Lichtenstein, 2005; Park, 2005), and perceived external environmental conditions (Lettl et al., 2008; Shane, 2000). In terms of the role of individual characteristics, Kaish and Gilad (1991) suggested that managers and entrepreneurs searched for opportunities in different ways. Entrepreneurs exhibited more alert and introspected in comparison to managers. Busenitz (1996) replicated the finding and indicated that entrepreneurs spent more non-business time searching for opportunities and ideas than managers did. McCline et al. (2000) investigated the issue of entrepreneurial uniqueness and the frequently presumed tendency of entrepreneur to recognize opportunities. They used the health care industry to explore the potential for entrepreneurial opportunity recognition and the attitude approach to correctly classify entrepreneurs from non-entrepreneurs. In addition, Hayton (2005) proposed that individual human capital such as education, intelligence, and cognitive style were associated with receptivity to innovative ideas. When entrepreneurs were diverse in terms of educational and functional background, they were more likely to consider from different perspectives and therefore became more creative in the interpretation of the meaning of new knowledge. Similarly, Bhagavatula et al. (2010) argued that human capital such as experience, professional skills and language skills, had a direct and a mediated effect on the resource acquisition and opportunity recognition. Hsieh et al. (2007) argued that entrepreneurs with exceptional abilities to acquire, accumulate, and apply knowledge were more likely to benefit from recognition, and could also afford to widen the range of complexity over which they retained authority-based governance. Tumasjan and Braun (2012) tested the hypotheses on the role of regulatory focus and two task-specific aspects of self-efficacy (i.e., creative and entrepreneurial self-efficacy) in opportunity recognition using a sample of 254 entrepreneurs with different industry backgrounds. The results indicated that a promotion focus positively influences opportunity recognition. Similarly, Wang et al. (2013) showed that an individual's self-efficacy, prior knowledge, social networks, and perception about the industrial environment on opportunities all had positive effects on entrepreneurial opportunity recognition. Regarding the social network and capital effects on opportunity recognition, Arenius and Clercq (2005) focused on examining the effect of individuals' network contacts on opportunity recognition. They argued that the potential access to network contacts was an important mechanism through which individuals' human capital such as individuals' educational level and work status affected opportunity recognition. In addition, Carolis and Saparito (2006) explored the relationships among particular dimensions of social capital and cognition on entrepreneurial opportunities and suggested the importance of network relationships to the stimulation and advancement of new ideas. Similarly, Ozgen and Baron (2007) investigated the effects of three social sources of opportunity-related information, including mentors, informal industry networks and participation in professional forums, on opportunity recognition and indicated that all three social sources of information exerted direct and positive effects on opportunity recognition. Bhagavatula et al. (2010) found that firms that operate in an environment that is rich in opportunities benefit more from structural holes, because these facilitate the recognition of opportunities, than firms that operate in a stable environment. Kontinen and Ojala (2011) found that in gaining foreign market entry, the family SMEs...
Mobilizing human and social capital under industry contexts to pursue high-tech entrepreneurship.
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