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Determinants of new firm success

Author

Listed:
  • Veronique A.J.M. Schutjens

    () (Urban Research Centre Utrecht , Faculty of Geographical Sciences, Utrecht University, PO Box 80.115, 3508 TC Utrecht, The Netherlands)

  • Egbert Wever

    () (Urban Research Centre Utrecht , Faculty of Geographical Sciences, Utrecht University, PO Box 80.115, 3508 TC Utrecht, The Netherlands)

Abstract

The differences between new firms, even the differences present right at the start, may affect their life course and success over time. This article addresses the determinants of success of Dutch start-ups from a longitudinal perspective. After an overview of the literature on both the definition of success and the success factors of new firms we test how new firm characteristics relate to firm growth in number of employees using a panel of nearly 2,000 firms. In addition to a large firm size right from the start, good preparation, having a business partner, and some years in salaried employment also enhance firm growth. Based on these success determinants we construct a typology of starters that may be used to predict future growth chances.

Suggested Citation

  • Veronique A.J.M. Schutjens & Egbert Wever, 2000. "Determinants of new firm success," Papers in Regional Science, Springer;Regional Science Association International, vol. 79(2), pages 135-153.
  • Handle: RePEc:spr:presci:v:79:y:2000:i:2:p:135-153
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    Keywords

    New firm growth; success determinants; starter typology;

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups
    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General

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