Entrepreneurship, Competitiveness and Local Development

Entrepreneurship, Competitiveness and Local Development

Frontiers in European Entrepreneurship Research

Edited by Luca Iandoli, Hans Landström and Mario Raffa

This book draws together leading academics to provide a state-of-the-art overview of the key challenges to entrepreneurship in Europe.

Chapter 6: Start-ups in the Netherlands: A Longitudinal Study on the Factors for Growth

Petra Gibcus, Pauline de Jong-‘t Hart and Ron Kemp

Subjects: business and management, entrepreneurship

Extract

Petra Gibcus, Pauline de Jong-’t Hart and Ron Kemp INTRODUCTION The dynamics and growth of firms are considered to be important for enhancing economic growth, and growth is an issue at all times. Growing firms are a stimulus for the economic development of nations (Audretsch et al., 2004). Not surprisingly, the growth of firms and growth patterns have received much attention from researchers during the last two decades (Bruno et al., 1992; Welbourne et al., 1998; Brown et al., 2001; Delmar et al., 2003; Bosma et al., 2004, Garnsey et al., 2006). Bangma and Verhoeven (2000) found four different types of growth patterns in the Netherlands: fast-growing firms, those growing at a normal rate, stable firms and shrinking businesses. This classification of firms in a growth pattern is not stable over time. Fast-growing companies do not go on growing rapidly for years. Even over a short time horizon the dynamics are considerable. Fast-growing firms accounted for almost 44 per cent of employment creation between 1998 and 2002 (Bangma et al., 2005). More importantly Bangma and Verhoeven (2000) note that start-ups in particular show (fast) growth. From an organizational point of view, growth is an important issue as well. Growth is often seen as an important performance measure that gives insight into the vitality and competitiveness of the company. For start-ups, growth in the first years is often a prerequisite for survival. On a general level, organizations can benefit from growth in many ways, including greater efficiency...

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