Abstract
Entrepreneurship is widely believed to be an effective tool for socio-economic development. Ironically, the discussions in entrepreneurship predominantly hover around the economic side of development with fleeting mentions of the social impact. While social entrepreneurship has taken the responsibility of evening out the imbalance, even the smaller and not-so-innovative enterprises in every economy that provide the jobs and ensure basic social needs seem understudied. Many of these would probably fall under what The Global Entrepreneurship Monitor (GEM) Report terms ‘necessity entrepreneurship’ and ‘necessity entrepreneur’. While the category seems different from micro or small business, the research on necessity entrepreneurs seems sparse. The book under review has opened a small door into this subgroup of entrepreneurs and their practices, albeit one which may open many more doors for researchers.
The editors of this book, a practitioner–academic duo, form an interesting team to bring out this volume. The authors make a loud case for ‘necessity entrepreneurs’ to be an area of study with even fundamental questions requiring answers. An optimistic researcher is bound to see a greenfield for potential research. The book contains 9 chapters contributed by 13 authors (including editors) and a foreword by Lawrence Harrison. The nascent state of the field is reflected in the contributions, with a majority being perspectives or personal experiences.
Dr Jeremi Brewer opens the volume with a chapter on attempting to define and classify necessity entrepreneurs. The literature review by the author is sparse, and much of the cited literature is borrowed from related disciplines (poverty alleviation, micro-finance, micro-enterprise). This reflects the limited work done by academics on this topic. The various adjectives and nouns used to describe entrepreneurs of this category are thought provoking (p. 8). While defining a necessity entrepreneur seems challenging enough, the author’s attempt to classify them (pp. 17–18) as low-performing, mid-performing, and high-performing seems shallow. The chapter clearly demonstrates the gnawing gap available for researchers of entrepreneurship in this area.
Stephen Gibson’s chapter is a practitioner’s firsthand account of creating ‘necessity entrepreneurs’. It passionately talks of how one can use education to get the poorest people of the world into entrepreneurship and enable them rise out of poverty. The table titled ‘The 25 rules of thumb’ (p. 34) is a fine collection of what needs to be taught to micro-enterprise owners. The author’s experience of having collated this from practice makes it a powerful input for policy makers and educators while framing curriculum. In contrast to Gibson’s experiences, John Dencker’s chapter presents findings from a study of the unemployed taking to entrepreneurship by necessity. It sheds light on the founder characteristics, experiences, and knowledge levels that influence venture survival and growth. The two chapters together expand the universe of potential necessity entrepreneurs.
John Hatch’s case of turning illiterate mothers into businesswomen resonates with the widely held view that women are more dependable pivots for development. This chapter is illuminating in a number of ways: it asks number of questions around who is a necessity entrepreneur; it provides an experiential ride through a practitioner’s real journey; it shares pragmatic steps for implementing an education initiative among the poor illiterate women in developing countries; it also provides some thought-provoking suggestions on how to implement such training programs. Among the many suggestions, one that struck me strongly was ensuring a school going child or educated neighbor attends the training program along with the illiterate mother (entrepreneur-to-be). The author’s remark that it takes about two generations to bring a family out of poverty, even if entrepreneurship is used as a tool, raises number of policy related questions.
Mark Coffey’s tour into the world of micro-finance institutions (MFI) and how they can influence micro-enterprise creation is a natural next chapter. The author presents a case for how MFIs are ideally placed to enable micro-enterprise creation especially among the poorest sections of society. The trust that MFIs can gain from the local communities if they provide allied services such as health and education makes them strong contenders for playing a larger role in creating necessity entrepreneurs. This can have a huge impact on the economic development of these societies and improve sustainability of the micro-enterprises while also improving the MFIs themselves.
Claudine Kearney and Robert Hisrich provide an introduction to the subject of entrepreneurship in developing economies and the major barriers: social, cultural, regulatory. Although this chapter contributes little directly to the discussion on ‘necessity entrepreneurs’, it highlights the importance of improving infrastructure to promote entrepreneurship.
Wendy Lindsay’s chapter on entrepreneurial intentions of nascent entrepreneurs driven by necessity is a longitudinal study with readings taken at three points in time: before the training intervention, 12 months after the intervention, and the last about 3.5 years after the second measurement. While it does indicate that women make better students in necessity entrepreneur training interventions, how to sustain entrepreneurial intentions over time remains a question for further research. Her claim that most behavioral research is based on Western, Educated, Industrialized, Rich, and Democratic (WEIRD) societies (p. 119) is both a factual observation as well as a call for more research from the developing world.
Gibb Dyer provides insight into the role of family capital in entrepreneurship and builds a strong case for its use, especially by necessity entrepreneurs. Apart from sharing thoughts on what comprises family capital (p. 145) and its benefits, the chapter also cautions against the disadvantages that come with it. The emerging macro-level socio-economic trends on families may be relevant even to family business scholars.
Do ‘necessity entrepreneurs’ figure in the policy maker’s radar and how to ensure this group receives its fair due is the focus of the last chapter in this volume. The case study of Sri Lanka seems interesting not only because it is an emerging country but also that it has recently come out of a long civil war. The authors, Balan-Vnuk, Dissanyake, and O’Connor, share interesting policy level findings. Their suggestion that entrepreneurship education to existing small businesses may be a more productive policy investment than creating new necessity entrepreneurs seems contrarian and worthy of further investigation.
The book (volume 1 of a two-part series), succeeds in laying the foundation for academic inquiry into the subject of ‘necessity driven entrepreneurs’. The personal perspectives and experiences of the authors definitely display rich and quality efforts at poverty alleviation using entrepreneurship education. This well-produced book will be of interest to both practitioners (experiences, practices, processes, heuristics) and scholars (plethora of research opportunities). The book is a clarion call for a whole lot of entrepreneurship among entrepreneurship scholars, especially in developing countries, to explore, understand, and help enable the ‘necessity driven entrepreneur’.