Passion Isn't Always a Good Thing: Examining Entrepreneurs' Network Centrality and Financial Performance with a Dualistic Model of Passion

• Published date: 01 May 2014
• Date: 01 May 2014
• DOI: http://doi.org/10.1111/joms.12062
• Author: Violet T. Ho,Jeffrey M. Pollack

Passion Isn’t Always a Good Thing: Examining

Entrepreneurs’ Network Centrality and Financial

Performance with a Dualistic Model of Passion

Violet T. Ho and Jeffrey M. Pollack

University of Richmond

ABSTRACT We propose a conceptual model that links entrepreneurs’ passion, network

centrality, and financial performance, and test this model with small business managers in

formal business networking groups. Drawing on the dualistic model of passion, we explore the

relationships that harmonious and obsessive passion have with financial performance,

mediated by network centrality. Results indicate that harmoniously passionate entrepreneurs

had higher out-degree centrality in their networking group (i.e., they were more inclined to

seek out members to discuss work issues), which increased the income they received from peer

referrals and, ultimately, business income. Obsessively passionate entrepreneurs had lower

in-degree centrality (i.e., they were less likely to be approached by peers), and in turn

received less income from referrals and less business income. These findings highlight that

entrepreneurial passion does not always result in positive financial outcomes – the type of

passion makes a difference. Implications for research and practice are discussed.

Keywords: business networking groups, entrepreneurial performance, harmonious passion,

network centrality, obsessive passion

INTRODUCTION

I don’t think it’s all about money. If it were all about money, I wouldn’t be doing what

I’m doing. I think it’s all about passion. I think passion drives profits, whether you’re

running a business of your own, or you’re in a corporation. (Gail Blanke, Founder of

Lifedesigns, quoted by Byron, 2004)

Increasing attention from practitioners and researchers has focused on the role of passion

in the entrepreneurial process of discovering and exploiting profitable opportunities,

as well as in shaping entrepreneurial intentions and actual performance (e.g., Byron,

2004; Locke, 2000; Shane and Venkataraman, 2000). Theoretical advancements in this

Address for reprints: Violet T. Ho, Robins School of Business, University of Richmond, 1 Gateway Road,

Richmond, VA 23173, USA (vho@richmond.edu).

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© 2013 John Wiley & Sons Ltd and Society for the Advancement of Management Studies

Journal of Management Studies 51:3 May 2014

doi: 10.1111/joms.12062

area have argued that passion for one’s entrepreneurial work fosters greater persistence,

effort, enthusiasm, and overall success (e.g., Baron, 2008; Bird, 1989; Cardon et al.,

2009; Shane et al., 2003; Smilor, 1997). Empirical findings, while somewhat limited

compared to the body of conceptual works, demonstrate that entrepreneurs who are

passionate about their work enjoy greater venture growth (Baum and Locke, 2004; Baum

et al., 2001), and those who are perceived by investors as being passionate and prepared

are more likely to receive funding for their business plans (Chen et al., 2009).

These works portray entrepreneurial passion as a valuable characteristic that will

unequivocally yield positive outcomes. The possibility that passion may also have a dark

side has not been widely acknowledged or examined in the entrepreneurship literature,

even though this possibility has been empirically demonstrated in prior studies examin-

ing passion among workers, athletes, and other populations (e.g., Ho et al., 2011;

Philippe et al., 2010; Vallerand et al., 2008). While a small group of researchers have

postulated that entrepreneurial passion could result in negative outcomes (e.g., persis-

tence with a failing venture; failure to acknowledge disconfirming evidence) and have

called for studies to investigate ‘when passion can be enabling for entrepreneurs and

when it is debilitating’ (Cardon et al., 2005, p. 38), entrepreneurship scholars have yet to

respond to this call. Consequently, by accentuating only the positive effects of entrepre-

neurial passion, extant literature leads us astray by neglecting the potential downside of

such passion, and risks perpetuating a skewed, inaccurate view of passion and its con-

sequences. Such an overly positive representation of passion can then mislead decision-

makers (e.g., venture capitalists, entrepreneurs) into indiscriminately seeking passionate

entrepreneurs to invest in or work with when, in reality, passion may not always yield

benefits. Further, from a research standpoint, linking entrepreneurial passion to only

positive outcomes, without a concomitant consideration of potential negative effects,

serves as a biased and incomplete representation of the phenomenon and falls short of

advancing theory in this area.

The imbalanced emphasis in entrepreneurial passion research underscores the need to

consider both the benefits and drawbacks of having passion, as well as the contingencies

under which either outcome may ensue. We address this need by drawing on literatures

related to the dualistic model of passion, social networks, and entrepreneurship to

develop and test a more comprehensive model of entrepreneurial passion. Our model

distinguishes between two forms of entrepreneurial passion (harmonious and obsessive)

to demonstrate that, depending on the type of passion entrepreneurs possess, their

financial performance can be either enhanced or diminished by passion. We also

advance theory by explicating the mediating mechanism – network centrality – through

which passion translates into financial performance, and test our model in business

networking groups. These groups provide a rich setting to examine entrepreneurs’

passion, networking behaviours, and the ensuing financial outcomes, as they are formed

specifically to help entrepreneurs seek as well as provide referrals, help, and other

resources to one another, thereby offering a particularly appropriate context to answer

the questions of when and how passion may facilitate or hinder entrepreneurs.

Multiple theoretical and practical contributions emerge from our study. First, the

present work contributes to entrepreneurship research by providing clarity and precision

on how to conceptualize passion in the entrepreneurial context. We argue that the

V. T. Ho and J. M. Pollack434

© 2013 John Wiley & Sons Ltd and Society for the Advancement of Management Studies