Symptoms of Survival: Variance and Temporality of the Entrepreneurship Nexus

Understanding what drives startup survival is of high interest for entrepreneurship research. We develop a dynamic model of early entrepreneurship that includes key input factors of nascent firms, namely the entrepreneurial founding team (EFT), entrepreneurial opportunity, and external financing. Based on a hand-collected sample of 2670 observation on 538 early stage ventures from both Europe (252) and Latin America (286) we jointly analyze the effect of EFT and entrepreneurial opportunity quality and external financing on startup survival. Further, we explore external financing by venture capitalists as a mediator mechanism through which EFT and entrepreneurial opportunity influence startup survival. Our paper contributes to the individual-opportunity nexus theory by disentangling the effect of both actor and non-actor part of the entrepreneurship nexus and to the entrepreneurial process perspective by analyzing the influence over time. Our findings show that the relevance of EFT and entrepreneurial opportunity shift over time: EFT becomes gradually less important and entrepreneurial opportunity becomes more important over time. Further, both effects are partially mediated by external financing.